What are Tech Warranties?
All genuine Australian-certified products sold by a genuine Australian online or physical store have implied warranties under Australian Consumer Law.
According to the Australian Competition and Consumer Commission (ACCC):
“Warranties are extra promises that a business makes about the quality of a product or how it will fix any problems with a product or service.”
These are on top of consumer rights to a repair, replacement, refund or cancellation when there’s a problem with a product or service. Warranties must be honoured by businesses and staff must not pressure or mislead consumers to purchase extended warranties.
That doesn’t mean they don’t ask if you want to purchase an extension though, and nearly every time you purchase some new tech, there’s an option to add an extended warranty. You’ve probably found yourself asking, is it worth it? Would I even need it? Am I crazy not to purchase it?
Honestly, the answer is usually no for personal electronics.
Most of the time, the only people that benefit from tech warranties are retailers as they translate into serious profit margins. If people knew the actual statistics for how long their products last, they probably wouldn’t purchase extended warranties. According to Cyber Shack, a quality smartphone has less than a two per cent failure rate while a good laptop is under five.
Under the ACCC, your product has a warranty for however long it is reasonably expected to last. No one purchases a computer with the expectation it’s going to last only one year, but years, so that’s how long you can legally claim a refund, replacement or repair — your choice — as long as you provide proof of purchase and the fault is a manufacturing one. You may also be able to claim compensation if you can prove loss due to the item and companies cannot deny a claim or refer you to the manufacturer unless you agree. Make sure you also register the standard warranty after purchase so there is no hassle when you do need repairs.
Rather than spending money on extended warranties which can cost between 10 to 20 per cent of the retail price, consider spending that money on backup devices.
Extended tech warranties for businesses are different
When considering warranties for your business, you have different factors to consider, such as risk reduction, business longevity and employee productivity, which means extended warranties for business are needed and are usually part of the cost of doing business.
Pronet only sells our clients servers with 3-year warranties and then just before the end of those 3 years, we highly recommend clients purchase an extra 2 years, which we find most businesses are willing to do. Replacing servers are not as simple as replacing workstations as they take longer to install, test and get up and running as they have to be reconfigured around other network components which can cause delays to your business. If you have the warranty, manufacturers will then keep components available to honour the warranty so if you have older equipment without one, you may no longer be able to find the parts to fix them.
Businesses relying heavily on their computers should only be purchasing business-grade computers which have a base 3-year warranty period rather than the 1-year that personal, domestic computers offer. Our clients are then recommended to purchase an extra 2 years to push this up to 5 years, after which business computers are usually replaced.
Businesses that rely on their computers and technology should be using a managed service provider to look after their systems. It saves you the stress and time of dealing with having to contact and wait for manufacturers to come out and fix or replace the device. Experienced MSPs usually carry spare parts for common devices and systems they set up in your business, so if you have an issue, they can fix it for you promptly. Some MSPs would even carry ‘spares’ of critical equipment which they can loan you while your equipment is being fixed.
As a business owner or decision-maker, you’re constantly evaluating how to lower your risk, and using an MSP is the way to do this. We hope that answered some of your questions regarding tech warranties, but if you have any further questions, feel free to give us a call!
