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ACCC boss slams ‘poor’ and ‘unacceptable’ NBN marketing

The Australian Competition and Consumer Commission (ACCC) has slammed internet providers’ NBN marketing efforts with commissioner Rod Sims describing current advertising as “poor” and “unacceptable”.

NBN plans have been plagued with consumer misunderstandings resulting in Telstra announcing last May dissatisfied users would receive refunds and Optus following suit over the weekend.

 

The comments come as the watchdog releases guidelines suggesting advertisers avoid publicising the maximum speeds – as nbn™ does – that customers can expect to achieve during evenings.

The ACCC admitted such detailed guidance to industry is an unusual step: “We judge, however, that such a step is necessary because the current advertising around NBN products is poor, which is unacceptable in the context of a forced migration to the NBN,” Sims said in a media statement.

“Currently around 30% 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.

“With this guidance, if you buy a ‘Basic evening speed’ plan you should generally not expect speeds much different to your pre-NBN experience. If you buy ‘Standard evening speed’ or higher plans, you should expect certain minimum speeds during busy periods,” Sims said.

The ACCC has created standard labels it would like the industry to adopt so customers can better compare plans and understand the product they will be getting.

Label Basic evening speed

Standard evening speed

Standard plus evening speed

Premium evening speed

Minimum typical busy period speed * 15 Mbps 30 Mbps 60 Mbps

*No minimum speed is specified for the ‘basic evening speed plan’

“Retailers should be very clear with customers about the typical speeds they can expect during busy evening periods. It is not acceptable to advertise an ‘up to’ speed claim, as this can give the false impression that the speed advertised is achievable at most times, including during the busy period,” Sims continued.

The commissioner admitted in the media release the suggestions have no formal legal standing but warned advertisers that the watchdog will take a dim view on those not following them.

“While the guidance is voluntary, it provides a strong benchmark against which the ACCC, and more importantly the community, will judge the advertising of retailers,” Sims said. “The ACCC will also be closely monitoring retailer compliance with the Australian Consumer Law.”

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