Dell lands in hot water over Taiwanese pricing glitches

In late June and early July, Dell's Taiwanese Web shop accidentally created some outlandishly cheap deals on Dell hardware which resulted in a huge influx of orders that Dell could not fill. The company is now facing fines from Taiwan's Consumer Protection Commission and Fair Trade Commission for misleading customers.

From about 11pm on June 25 until 7am the next day, Dell mistakenly had a 19" LCD monitor on its site listed as costing NT$500, or roughly $15. In that 8 hour period, deal-crazed consumers ordered more than 140,000 of the cheap monitors only to later be told that it was a mistake. Taiwan's Consumer Protection Commission reported 471 complaints, and then recommended that Dell give each customer one monitor at the $15 and then offer the rest (since everyone ordered multiples) at a discount.

Dell Taiwan later compensated monitor buyers with an NT$1,000 discount coupon, but naturally the consumers were upset.

As if that wasn't enough, a second glitch happened on July 4 at midnight that offered a certain configuration of the Latitude E4300 notebook --valued at NT$60,900 ($1,855)-- for only NT$18,588 ($566). More than 49,884 notebooks were reportedly ordered during that mishap.

The company offered coupons to those who placed orders, but the NT$20,000 ($600) discount was again not good enough to smooth over the costly mis-labeling.

So today, in addition to the discount vouchers Dell is offering for both products, Taiwanese authorities say the computer company must pay one million Taiwan dollars ($30,500) for failing to fully honor the online offers, and The Fair Trade Commission has launched an investigation into whether Dell was misleading consumers on its Web site, which could result in a further fine of up to 25 million Taiwan dollars ($770,000).

It's actually quite a small price to pay. If Dell were to fill all the orders it received both times, it would amount to a loss of more than $76 million.