The company sent its customers inaccurate pricing details about a competitor's product in a email notice giving them a misleading impression on the value of its own service.
Ihug New Zealand director Tim Wood, blamed the ISP's marketing department for the gaffe.
"Someone copied and pasted the wrong information into the email, and then sent it basically" said Wood.
The notice at the heart of the dispute was sent to inform its Jet2000 subscribers of an impending increase in bandwidth charges for the DSL service.
The company told the subscribers to prepare for an increase in charges for excess data from 2 to 6 cents per megabyte to a flat rate of 10 cents per additional megabyte. Then the ISP goofed, sending inaccurate information to support its claim that the service was still one of the most competitive of the Jet Stream class of ADSL services in New Zealand.
It informed Jet Stream customers, incorrectly, that Xtra's (Telecom New Zealand's Internet division) competing DSL product carried an excess data charge of 20 cents per megabyte. Xtra charges 10 cents per megabyte for excess data on its Jet stream class DSL product.
The company sent an additional notice apologising to its customers for giving a misleading comparison of the value of the two services, but that didn't prevent the story reaching the New Zealand's largest newspaper the New Zealand Herald.
Wood expressed some disbelief that the paper had considered the error worthy of publication.
The class of residential DSL products to which the Jet2000 service belongs is the only one that New Zealand DSL resellers can set prices for excess data for.
