Apple coughing up $2.5M to settle 'iPad+4G' dispute

Apple (NASDAQ:AAPL) has agreed to pay the Australian government almost $2.5 million in fines and legal fees stemming from its promotion of the 4G capabilities of its latest iPad, which is incompatible with the spectrum currently being used for LTE in Australia.

Apple's payment of AU$2.25 million in fines and AU$300,000 in legal fees would settle the case brought against it by the Australian Competition & Consumer Commission, according to an AllThingsD article. However, the article said presiding judge Mordecai Bromberg of the Federal Court in Victoria has refused to approve the settlement until he is supplied with information indicating the number of customers who felt they'd been misled by the "iPad + 4G" branding Apple used in Australia and Apple's financial status.

"I don't know whether we're talking about a corporation that makes $10 million or $300 million," Bromberg said. "How do I know that (the penalty) is meaningful for Apple if you don't put before me any idea of what its financial position is?"

Apple has argued that any fine should not be based on its finances. The vendor has already offered refunds to customers who bought the new iPad believing it supported Australian 4G service.

Apple introduced its new iPad in March, with versions that work on the 700 MHz and 1.7/2.1 GHz bands in North America. Australia's Telstra runs its LTE network service in the 1800 MHz band.

A final ruling on the settlement is expected this month.

Bromberg might be interested to hear that during the first quarter of 2012, Apple continued to lead the media tablet market with nearly 65 percent of worldwide units, according to ABI Research. The iPad surpassed 67 million cumulative shipments in its first eight quarters of availability.

Apple's 11.8 million iPad shipments during the first quarter "were spurred by the launch of a third-generation lineup and price reduction on iPad 2 models, while Samsung's 1.1 million shipments returned the vendor to the number two spot after Amazon's Kindle Fire shipments fizzled entering 2012," said ABI.

The company said the iPad cannot claim the highest mobile broadband (3G/4G) attach rate for media tablets, though Apple retains its title of shipping the most 3G-enabled tablets by outpacing the number two competitor by a factor of eight. "The majority of iPad buyers continue to be satisfied with Wi-Fi wireless coverage," said Jeff Orr, ABI group director, consumer research.

The leading model shipments and the ongoing challenges mobile operators face in convincing iPad owners to even try the mobile broadband connectivity once are expected to continue for the foreseeable future, ABI said.

The media tablet market saw shipments of 18.2 million devices in 2012's first three months, which represents a 185 percent year-over-year gain.

For more:
- see this All Things D article
- see this ABI release

Related articles:
Flurry: Seven out of every 10 apps are developed for Apple's iOS
ABI: 17.6M tablets shipped last year with 3G/4G modems
Survey: New iPad users like LTE but think it's too expensive
Apple's iPad '4G' advertising claims draw European scrutiny
Apple's new iPad encourages LTE usage but data pricing may drive users to Wi-Fi
Apple sells 3M new iPads in first weekend of availability

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