Are brands coated with teflon?

Visy, Qantas and now Telstra... in the dock.

I have friends who work for Telstra who are intelligent, honest people. So it pains me when their employer acts like a boofhead.

Telstra told lies in its advertising: Next G is not everywhere you need it. Far from it, Next G covers less than a quarter of Australia. A Federal Court found the Telco guilty… and it is. And it is telling more lies to defend the first set of lies.

Telstra’s Peter Taylor tried to redefine what the ads said, claiming they did not promise complete coverage. Instead he says they meant to say that: “Telstra's Next G network is the largest mobile network in Australia that provides coverage in more places in Australia than any other mobile network including the old CDMA network.''

The ACCC and the Court assumed that normal consumers would think ‘everywhere you need it’ meant everywhere they were likely to go, no exceptions.

Mr Taylor’s defence is curious: He seems to argue that Telstra customers don’t expect honesty in advertising from Telstra. "Telstra gives its customers credit for understanding advertising. Do people really believe that Vegemite puts a rose in every cheek?''

So it comes under the heading of “puffery” and no doubt Telstra’s legal team will rely on the Carbolic Smoke Ball Company case in torts which enshrines in law the advertiser’s right to use world like ‘the best’ to describe their offerings.

It is one thing to fall foul of the ‘misleading and deceptive’ provisions of the consumer protection regulations. But you take your medicine and move on. But not Telstra. That Sol Trujillo. He’s got cojones.

What the ACCC and the Federal Court fails to understand is that the world ‘you’ in ‘everywhere you need it’ doesn’t mean people who live in rural and remote areas. Many ‘non-you’ people rely on the Telstra’s CDMA network, which it wants to turn off next month.

Meanwhile Telstra chief executive Sol Trujillo earns $22million a year. How does that work?

Industry commentator and editor of iWire, Stuart Corner, says: “When I first saw Telstra's advertising slogan for Next G claiming ‘coverage everywhere you need it’ I thought it unwise, because it is patently false. My second thought was that Telstra is going to be in trouble for this, and it did not take long for the ACCC to prove me right. Telstra has vowed to appeal a federal court decision that its Next G advertising was and continues to be misleading. It would do better to let the matter rest ... The only company that could make the claim "coverage everywhere you need it" with any real claim to accuracy would be a satellite operator.”

Blatant lies. Is this the future of corporate governance? Or is it the past, the moral legacy of the Howard era where telling lies was acceptable for the PM and his cabinet.

PS. Did you note the irony here: me, accusing Telstra of making misleading statements? Mr Thought-A-Day. It's one thing to be a hyocrite. it's entirely another to recognise it. Now where's my $22million?