The $402,375 fine handed down to Vodafone today for breaching the Fair Trading Act is just the first of six cases involving the company relating to alleged misleading broadband or mobile promotions.

The Commerce Commission has reacted to the fine by saying the Vodafone Live service had a "serious design flaw" which resulted in many customers incurring unwanted costs.

The Commission said it wasn't clear how many customers had been affected, but that some may not have even noticed the extra charges on their bills when the offending occurred in 2007 and 2008.

The $400,000 fine was imposed at the Auckland District Court this morning after Vodafone pleaded guilty last month to five charges laid by the Commission.

In addition to the Vodafone Live issue, the Commerce Commission is pursuing Vodafone on five other charges:

- The extent of the coverage of Vodafone's 3G mobile broadband service, made in Vodafone's 'broadband everywhere' marketing campaign between October 2006 and April 2008;

- The availability of a $10 free airtime credit for those customers who registered their details on Vodafone's website between May 2007 and September 2008;

- The cost of using Vodafone's $1 per day casual data charge for Vodafone's mobile internet service between July 2008 and November 2008;

- The size of Vodafone's mobile phone network between September 2008 and February 2009;

- The price of a Sony Ericsson W200i mobile phone between July and August 2007.

Late this morning Vodafone apologised again for what it called "technical problems" around the Vodafone Live service, where customers did not know when they crossed from free Vodafone Live sites onto other sites attracting a data charge of $11.25 per megabyte.

At least one customer was charged over $1300, said the Commission's competition manager Stuart Wallace.

"It is unclear just how many customers were affected, as Vodafone did not keep detailed records of complaints. But Vodafone has agreed that it was likely to have involved significant numbers of its customers and large amounts of money."

Wallace said that while Vodafone had subsequently refunded some affected customers and changed the way it promoted Vodafone Live, as well as how it charges for data services, "it was slow to respond to the problem.

"The offending continued over a period of 14 months. Refunds were given reluctantly and on an inconsistent basis," said Wallace.

Vodafone's records showed that of $22m in revenue from data charging between June 2007 to July 2008, it had refunded $3.6m to 20,851 customers.

Although the company said the figures were of refunds overall because it could not split out exactly which customers had been affected by the Vodafone Live issue.

Vodafone faced a maximum penalty of $1m, but the Commission had sought a fine of $500,000, while Judge Roderick Joyce QC went with a starting point of $580,000.

He discounted the fine because of Vodafone's clean prior record, its cooperation with the Commission, its unreserved apology and an early guilty plea.

"Vodafone's shortcomings must, in my view, have had a very real impact on many consumers or customers," Joyce said in his judgment.

"The money sums in question might have meant nothing to someone of considerable means but pay-as-you-go customers are surely not in that category ... in any event, no-one - rich or poor - should ever have to pay what, properly pre-warned, they could avoid paying."

In a statement Vodafone said it "would never deliberately mislead our customers" and had "refunded all the customers who were affected by this issue.

"We have put in place measures to make sure that customers are not confused by data charging and we are constantly reviewing and refining these processes."

Telecommunications Users Association of New Zealand chief executive Paul Brislen said the fine would act as a deterrent but that the offence was "historic", as telcos did not now offer "walled gardens" of internet access.

Brislen, who was head of communications at Vodafone at the time of the offending, said companies could build complex plans that were sometimes difficult for consumers to understand, especially if they didn't read the terms and conditions.

"They are confusing plans - I'd like to see a lot more clarity with regard to how telcos represent the various offers and services they've got.

"Having said that, compared to places like the UK and Australia we have a simple approach ... our telcos do a much better job than international markets where companies do things like offer unlimited plans with a little asterisk saying there is a limit - we just don't get into those types of things."