ACCC slams "poor" NBN advertising, calls for overhaul

The ACCC has called out ISPs over the way NBN broadband speeds are advertised and called for an overhaul on plan marketing, with a focus on clearly identifying typical minimum speeds during peak periods. 

The competition watchdog published its “Broadband Speed Claims - Industry Guidance” report, in which it seeks to change retailer advertising standards from selling their products based on the maximum internet speeds that may be possible on a plan, to the speeds consumers could reasonably expect during evening periods between 7pm and 11pm.

ACCC chairman Rod Sims said about 30 percent of NBN customers were on 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,” he said.

In what it admitted was “an unusual” step for it to undertake, the regulator’s guidance also includes the creation of standard labels it would like the industry to adopt in the interest of clarity to customers.

“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.

“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.

“In some cases it is not clear from the advertisements what sorts of internet speeds consumers can expect at all."

Sims said the ACCC felt the steps were necessary given the “poor” advertising around NBN products, which was “unacceptable in the context of a forced migration to the NBN”.

“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. The ACCC will also be closely monitoring retailer compliance with the Australian Consumer Law,” he added.

The watchdog announced the Broadband Performance Monitoring and Reporting program in early August after putting out a call for volunteers to measure NBN speeds earlier in the year. The performance and monitoring program will see hardware installed in 4000 homes to perform remote testing and monitoring of typical fixed-line NBN speeds, which the ACCC will make public.

“This visibility will inform consumers and push retailers to lift their game. The speed advertising guidance will complement this by seeing consumers properly informed about what they are buying,” the ACCC said.

The government has also this month called for a review into NBN customers' experiences in the wake of a war of words between the NBN and ISPs on who was to blame for slow speeds. 

The Australian Communications and Media Authority will work with the Department of Communications and ACCC to investigate the most common issues with the NBN and the best way to avoid or remedy them.