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Is Kogan Mobile's usage policy illegal?

In the wake of claims that heavy users are being disconnected, a telco lawyer has called Kogan's policy "plainly illegal".

In the wake of claims that heavy users are being disconnected, a telco lawyer has called Kogan's policy "plainly illegal".

(Screenshot by CNET Australia)

Kogan's recently launched mobile service has gathered a lot of attention, offering free texts and calls along with a hefty 6GB of data.

Recently, however, some users have claimed that they've been disconnected from the service after heavy use, which is a violation of Kogan's acceptable use policy. In some cases, according to the Sydney Morning Herald (SMH), users were being accused of using the phone for business purposes.

Kogan's usage policy sections 5.2 and 5.3 state the following:

We reserve the right to disconnect or separate into a separate pool the users that stay connected to the Service continuously for an unreasonable amount of time, or download or upload an unreasonable volume of data, given the purposes for which the Service is provided to you and the usage patterns of other users (for example, staying connected continuously for several days, or downloading gigabytes of data in a short period).

We consider your use of a service to be unreasonable if you make or receive calls on our network other than for your own personal use. We may give or withhold our consent, or make our consent subject to conditions, at our discretion.

Now the SMH is reporting that Peter Moon, a telecommunications lawyer with Cooper Mills, has called the Kogan Mobile usage policy "plainly illegal" and a breach of both the Telecommunications Consumer Protections code and Australian Consumer Law.

Mr Moon made the comments on the website TCPCode.com.au, which is owned and run by his employer Cooper Mills. The comments have been removed after a request by Kogan's lawyers, although Moon told the SMH that he stood by his assessment of the policy.

Many of the issues apparently cited by Moon regard the apparent lack of clarity in the use of the word "unlimited" and the usage policy in general, including the fact that Kogan reserved the right to change the policy at any time. This, he said, "[breached] the 'unfair contract terms' rules in the Australian Consumer Law".

Kogan has rejected the claims, saying that its policy had been drafted by law firm Gilbert + Tobin, which is regarded as "one of the leading telecommunications law firms in Australia".