News Dell Fined $6.5m for Exaggerating Web Store Monitor Bundle Discounts

[Admin]

Dell Australia has been fined AU$10 million (US$6.5 million) for misleading strikethrough discount bundle pricing offered to buyers with a computer in their web store cart.

Dell Fined $6.5m for Exaggerating Web Store Monitor Bundle Discounts : Read more

 

[NeoMorpheus]

Dell breaking the law??

No way!

 

[TechieTwo]

Apparently using U.S. advert tricks doesn't fly in Australia.

 

[grein002]

Dell breaking the law??

No way!

Any company breaking the law?

No way!!

 

[InvalidError]

Magically inflated regular prices to make discounted prices look better are BS. Good thing some places have regulations against falsely marketing fake "regular" prices to make fake "discount" prices that often aren't anything more than the regular retail price feel better than they actually are. There should be more of those and stiff enough penalties to snuff out any profit motive for doing it.

 

[digitalgriffin]

Only a marketing guy looking at his year end bonus would do such a scummy thing.

 

[USAFRet]

Magically inflated regular prices to make discounted prices look better are BS. Good thing some places have regulations against falsely marketing fake "regular" prices to make fake "discount" prices that often aren't anything more than the regular retail price feel better than they actually are. There should be more of those and stiff enough penalties to snuff out any profit motive for doing it.

Standard BlackFriday pricing.

 

[Rakanyshu]

Standard BlackFriday pricing.

was going to say something like this. Sadly happens everywhere with all kinds of merchandise not only IT related.
i Think fines are so low every now and then big companies does something like this and just "cooperate" and pays the fine...

 

[PEnns]

Those fines are so ridiculous (those are billion dollar companies after all!), it's almost an invitation to keep doing this scam!

 

[Co BIY]

Only a marketing guy looking at his year end bonus would do such a scummy thing.

Everything done would have been fine if the numbers had been right/honest.

Australia seems to prefer the Walmart- style pricing scheme of an "Everyday Price". - Me Too!

Actually pretty impressed that Australia accurately labels their indirect taxation scheme the "Goods and Services Tax" when other governments less accurately label them a "Value Added Tax" which I would argue "implies" that some value was added by the tax.

 

[Co BIY]

Those fines are so ridiculous (those are billion dollar companies after all!), it's almost an invitation to keep doing this scam!

I disagree. Only 5300 monitors sold with no estimated consumer loss given (I guess maybe as much as a $100 in bogus "savings" lost for each unit) . There is actually no allegation that consumers "overpaid" for the monitors. I think it is probably good to limit fines to somewhere below 10x the provable damages.

If the fines are allowed to become too large compared to the amount of business involved then the decision making about many things can get very out of whack.

 

[InvalidError]

If the fines are allowed to become too large compared to the amount of business involved then the decision making about many things can get very out of whack.

For a punitive fine to achieve its intended objective of discouraging the behavior it is about, it has to be a meaningful chunk of income or net worth in such a way that habitual repeat offences will drive the business into bankruptcy. If the fines are so low as to be sustainable, they'll just be absorbed as the on-going cost of dishonest business.

That is why some countries like Sweden scale fines with income and net worth to ensure even billionaires will feel the sting for driving 150+km/h over the speed limit.

 

[ilukey77]

I disagree. Only 5300 monitors sold with no estimated consumer loss given (I guess maybe as much as a $100 in bogus "savings" lost for each unit) . There is actually no allegation that consumers "overpaid" for the monitors. I think it is probably good to limit fines to somewhere below 10x the provable damages.

If the fines are allowed to become too large compared to the amount of business involved then the decision making about many things can get very out of whack.

yes and no it like ill use target as its universal as such well target is in Australia ( where im from ) and in America if target over charges every customer by $1 over all its stores on any given day and get caught doing it and has to pay lets say a $1million dollar fine for it they are still in front because how many millions of customers would visit target on said day or every day over all their stores country wide !!
hardly ever do these big corps get a decent fine to make them think twice yet the same fines imposed to a smaller company while still should be doing things within the law could fold !!

 

[PEnns]

I disagree. Only 5300 monitors sold with no estimated consumer loss given (I guess maybe as much as a $100 in bogus "savings" lost for each unit) . There is actually no allegation that consumers "overpaid" for the monitors. I think it is probably good to limit fines to somewhere below 10x the provable damages.

If the fines are allowed to become too large compared to the amount of business involved then the decision making about many things can get very out of whack.

Your arguments smells and looks like Swiss cheese.

"only 5300" is not a defence. "You honor, he killed only 2 people."

And meting out punishment in pennies is no deterrent to anyone, especially scammy behemoths like Dell.

Somebody I know well was charged, to quote your amazing argument, "ONLY $800" in fees by Dell because he didn't close his account after paying off the installments for the lousy $400 computer....

Such scam artists shouldn't be in business.

 

[Co BIY]

yes and no it like ill use target as its universal as such well target is in Australia ( where im from ) and in America if target over charges every customer by $1 over all its stores on any given day and get caught doing it and has to pay lets say a $1million dollar fine for it they are still in front because how many millions of customers would visit target on said day or every day over all their stores country wide !!
hardly ever do these big corps get a decent fine to make them think twice yet the same fines imposed to a smaller company while still should be doing things within the law could fold !!

So do you think the fines should be reasonably related to the amount of damages ?

 

[ilukey77]

So do you think the fines should be reasonably related to the amount of damages ?

be it far from me to say a figure but i think first offence should be related to the amount of damages the 2nd time should be double 3rd time they should be raped of there business im talking 100s of millions of dollars !!

some of these companies get a slap on the hand dont do it again $100000/ to a million to dell is like any average person with $5 in their pocket ..

Hit them really hard and 2 things will happen they will either think very hard before doing it again or 2 lose there business !!

 

[InvalidError]

So do you think the fines should be reasonably related to the amount of damages ?

A fine isn't supposed to be proportional to damages, it is supposed to be enough to dissuade you from repeating the same behavior ever again and should be proportional with your ability to afford it. For habitual offenders like Dell, this needs to be something like 10X the damages or 10% of gross profit, whichever is greater.

 

[TerryLaze]

some of these companies get a slap on the hand dont do it again $100000/ to a million to dell is like any average person with $5 in their pocket ..

Dell the behemoth made a whopping 500 million net income last quarter worldwide.
We have no idea how much of that Dell australia made, if it's 10% that would be 50 million and the 6.5 million fine would be more than 10% of that.
Is australia even such a large market?

https://investors.delltechnologies.com/static-files/be9c439d-1f01-48a5-8e17-206cae8cdc0f

 

[TerryLaze]

A fine isn't supposed to be proportional to damages, it is supposed to be enough to dissuade you from repeating the same behavior ever again and should be proportional with your ability to afford it. For habitual offenders like Dell, this needs to be something like 10X the damages or 10% of gross profit, whichever is greater.

I think what he is saying is that if the fine is too high then companies will always err on the side of caution and just not do any discounts at all anymore or only very small ones.

 

[InvalidError]

I think what he is saying is that if the fine is too high then companies will always err on the side of caution and just not do any discounts at all anymore or only very small ones.

Doing honest discounts isn't a problem and it is quite easy to tell what is a discount from what isn't by simply looking at retail price history: if the product has been at a regular sale price of $1000 for the last six months and then drops by $100, that is clearly a discount. If the price gets jacked up to $1200 two weeks prior to a $100 discount, that is the company attempting to screw people over with a $100 price hike disguised as a discount over an inflated retail price.

 

[lemongrassgarlic]

Dell should get fined for forcing the MaxxAudio/waves malware on nearly all of their laptops.

 

[Co BIY]

A fine isn't supposed to be proportional to damages, it is supposed to be enough to dissuade you from repeating the same behavior ever again and should be proportional with your ability to afford it. For habitual offenders like Dell, this needs to be something like 10X the damages or 10% of gross profit, whichever is greater.

I do think fines, even punitive ones, have traditionally been proportional to damages usually as a multiplier of some kind.

If a company is going to be fined in a small market based on worldwide income then it may be better to avoid the small market altogether.

The danger of regulators damaging the market and therefore citizens and consumers should also not be ignored.

 

[InvalidError]

The danger of regulators damaging the market and therefore citizens and consumers should also not be ignored.

If your company withdraws from a market because its business model revolves around on-going fraud and questionable business practices, then more power to the companies that remain. If all of the foreign suppliers for essential stuff bail out, then either there will be new domestic suppliers and manufacturers to pick up the slack of a government-run program to secure supply.

Dell doesn't have a monopoly on desktops, laptops, servers, parts, accessories and services beyond its own semi-walled garden.

 

[Co BIY]

Dell doesn't have a monopoly on desktops, laptops, servers, parts, accessories and services beyond its own semi-walled garden.

Which makes it easy for people to prevent them from taking advantage of them.

The people don't have easy alternatives when their government is the one causing problems.