INNOVATION

The ACCC Will Start Calling Out Internet Providers Over Misleading Speeds

About 5.7 million premises in Australia are able to connect to the NBN.

22/08/2017 1:15 PM AEST | Updated 22/08/2017 1:16 PM AEST
FAirfax/Shutterstock
Regulators are scrambling to address slow internet speeds as the National Broadband Network is rolled out across the country.

The consumer watchdog is giving internet companies to start revealing typical minimum speeds customers can expect at peak times, before it starts "calling out" retailers who dud customers with slower than advertised speeds.

Regulators are scrambling to address slow internet speeds as the National Broadband Network is rolled out across the country, as companies take advantage of the rush of millions of people making the switch to the network.

"Companies should no longer be advertising based on words like fast or up to 50 megabits-per-second," ACCC Chairman Rod Sims told the ABC.

Key Points:

  • The ACCC's Broadband Speed Claims – Industry Guidance seeks to move retailers away from advertising their services based on the maximum internet speeds that may be delivered during off-peak periods;
  • Instead, they want retailers to advertise the speeds consumers can expect to achieve during the busy evening periods between 7pm and 11pm;
  • If consumers experience problems with their network connections, or other faults that affect their service, they will be resolved quickly or be offered a refund or cancellation of their contract;
  • The watchdog says providing such detailed guidance to industry is an unusual step for the ACCC

"They can say some of these things, but what they have also got to say is to let consumers know what they can expect during those busy periods between 7pm and 11pm in the evening."

"What you've got now is companies advertising on the basis of up to 50 megabits per second, but you might only get 3 megabits per second in the busy period."

If you are getting low speeds now then I would urge you to contact your retailer and, frankly, complain.Rod Sims, ACCC Chairman

About 5.7 million premises in Australia are able to connect to the NBN, while about 2.4 million people have signed up, Communications minister Mitch Fifield said in April.

The network will be 75 percent built by mid-2018, and will be finished by 2020.

In April NBN Co's chief executive Bill Morrow said customers paying only $30 per month are part of the "land grab" by telcos.

The Telcos are trying to get ahold of as many customers as possible as millions of Australians transfer onto NBN Co's infrastructure from the Telstra-owned phone network.

ACCC
The ACCC is wants retailers to adopt labels such as these.

"You should expect a 12 megabit per second [Mbps] top line speed, and the actual speed at busy hour will depend and vary by retailer but I would not expect that speed to remain at 12 Mbps if you are paying $29," Morrow told Fairfax in April.

He told a parliamentary joint committee in August last year the slower 12 Mbps product "was never designed for broadband."

In May Telstra admitted in a blog post a small fraction of its customers may have been charged for unachievable NBN speeds.

On Tuesday morning -- following the ACCC announcement -- the country's second largest telco, Optus, reportedly said it will offer refunds to customers who effectively paid for speeds that couldn't be delivered over their type of NBN connection.

Fairfax
NBN chief executive Bill Morrow has said the company was investigating new broadband technologies, but most consumers would not yet pay for speeds greater than fibre to the node.

The ACCC said about 30 percent of NBN customers have been sold low-speed plans, with many not realising their internet speeds may not be any better -- and in some cases worse -- than existing ADSL services.

"Many other NBN customers, while on higher speed services, experience lower than expected speeds during busy periods due to under provisioning of capacity by their retail service provider," Sims said.

Communications Minister Mitch Fifield earlier this month asked the Australian Communication and Media Authority to try and get to the bottom of the speed issues and the dropouts that customers have been complaining about.

"What we've asked ACMA to do is to get more information from the retailers and more information from consumers about what the experiences have been in terms of connections, what the experiences have been in terms of fault resolution," Fifield said.

"We want to have maximum transparency. When you've got maximum transparency that means it's easier to see where responsibility lies. When NBN needs to lift its game and when retail service providers need to lift their game."

The ACCC is also in the process of developing a Broadband Monitoring System to monitor speeds throughout the day.

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