ARB rules Melon Mobile's 'unlimited' plans are misleading: here's why

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Industry standards

Melon Mobile has defended its advertising as reasonable, arguing that the limits set on usage were transparent and fair within industry norms. However, the ARB concluded that such practices do not align with the strict interpretation of “unlimited,” as they imply no restrictions.

The dispute centres on Melon Mobile’s advertising on its website, where phrases like “unlimited calls and texts” and “break free with unlimited plans” were prominent. Complainants alleged that such language falsely promised unrestricted usage, only for customers to discover caps under the Fair Usage Policy. Melon Mobile, represented by Copeland Attorneys, acknowledged the caps but argued that it clearly informed customers of the FUP in its Terms and Conditions. They asserted that consumers are required to accept these terms before finalising a purchase, thus rendering the claims fair and transparent.

The ARB’s Directorate disagreed, asserting that “unlimited” is a clear term that implies “no restrictions” without qualifiers or limits. According to the ARB’s ruling, the advertising strategy using the term “unlimited” is inherently misleading.

"As the Directorate has advised in previous rulings, to say that there are “unlimited” local calls and SMSs, and then clarify that the local calls
and SMSs are restricted, is like saying that an item is free, except that you have to pay for some of it. It is two contradictory statements and is therefore inherently misleading," the Directorate observed, referencing previous cases with similar rulings. This contradiction, the board said, could mislead the average consumer who may take the term at face value.

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Melon Mobile contends that the limits imposed on its “unlimited” plans far exceed industry averages, citing 120 minutes as a general monthly usage benchmark in the sector. They argued that their limit of 750 minutes on their lowest-tier package was fair and realistic, offering more than six times the average usage. In one complaint, the company noted that a consumer had consistently used over 4,000 minutes monthly, far exceeding the FUP limit. Melon Mobile offered this customer an opportunity to upgrade, which they declined, ultimately resulting in service suspension.

Disclaimer

While Melon Mobile’s legal representatives argued that consumers have an obligation to review Terms and Conditions thoroughly, the ARB highlighted that the advertisement's predominant message was “unlimited usage.” The board further criticised the absence of disclaimers or asterisks highlighting the FUP, concluding that the term “unlimited” had not been adequately qualified. The ARB pointed out that the disclaimer added by Melon Mobile—“Voice & SMS usage subject to limits in terms of Fair Use Policy. T’s & C’s Apply”—was too inconspicuous to alert consumers effectively.

In its decision, the ARB reinforced that companies cannot rely solely on fine print or secondary policies to counteract bold claims made in advertisements. Drawing on precedents from similar cases, including Telkom Mobile in 2016 and MTN in 2020, the Directorate noted that such advertising strategies create a dissonance between the perceived offer and the reality.

The ARB has instructed its members not to accept advertisements from Melon Mobile promoting “unlimited” packages where limits are in place.