Life Tech Optus to refund thousands of customers over misleading NBN speeds
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Optus to refund thousands of customers over misleading NBN speeds

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Optus will refund almost 9000 NBN customers over misleading, slow internet speeds. Photo: Getty
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Australia’s consumer watchdog has revealed the full extent of Optus’ part in misleading NBN customers, selling almost 9000 people unattainable internet speeds.

The Australian Competition and Consumer Commission (ACCC) announced on Monday that Optus has agreed to offer remedies to thousands of its fibre-to-the-node (FTTN) and fibre-to-the-basement (FTTB) customers who were sold substandard speeds.

This has come about one month after Telstra was forced to refund 42,000 of its customers who paid for speeds that could not be achieved.

The ACCC found that Optus misled 8700 of its customers about realistic maximum speeds on certain NBN plans between September 1, 2015, and June 30, 2017.

This included a “Boost Max” which was advertised as delivering download speeds up to 100 megabits per second (Mbps) and upload speeds up to 40 Mbps.

Almost half – 48 per cent – of FTTN customers paying for internet speeds of 100/40 Mbps were receiving substandard speeds.

More than 20 per cent received less than half of that speed – slower than the next speed tier down, 50/20 Mbps.

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Meanwhile, more than one-quarter – 26 per cent – of those who opted for middle-tier 50/20 Mbps plans were also ripped off, according to the ACCC.

Optus admitted that by promoting and offering speed plans that could not be delivered, it was likely engaging in misleading or deceptive conduct by making false or misleading representations, under Australian consumer law.

“Optus is the second major internet provider we have taken action against for selling broadband speeds they could not deliver to their customers,” ACCC chairman Rod Sims said in a statement on Monday.

“Worryingly, many affected Optus FTTN customers could not even receive the maximum speed of a lower-tier plan.

“This is a concerning trend we have seen throughout the industry and we are working to fix this.”

Optus is the second service provider to provide compensation to customers for selling misleading NBN speeds since the ACCC flagged the industry-wide problem in July.

Optus is required to contact affected customers before March 3, 2018, by email or letter.

Remedies

The telco will be providing remedies such as refunds, moving customers to other speeds plans, offering discounted speed plans or the option for customers to exit from their existing contracts without paying a fee, enforceable by the courts via the ACCC.

All future customers will be notified by Optus within four weeks of connecting to a new NBN speed plan to confirm whether they are receiving the appropriate internet speeds and be informed of a range of options.

However, customers who purchased their NBN plan as part of a bundle will not be offered the option of moving to a lower-tier speed plan other than the base speed plan.

“Affected customers should carefully consider the remedies Optus is offering them to assess which best suits their needs,” Mr Sims said.

“In some cases, consumers may consider it preferable to simply exit their contract with a refund rather than accept a service that does not meet their needs.

“We are continuing to investigate other retail service providers selling NBN broadband plans, and will take enforcement action if we consider that they are not delivering on their promises to customers.”

More transparency over speeds during peak times

An Optus spokesman told The New Daily it acknowledges it did not have the appropriate procedures in place to confirm the speed of the NBN service at the time of purchase.

“We apologise to customers who have been affected by this error and are putting a process in place to rectify this issue,” he said.

“We have been working cooperatively with the ACCC to remediate affected customers for differences between their chosen speed plan and the speed obtained.”

Both Telstra and Optus now transparently outline expected maximum speeds during peak times between 7pm and 11pm.

Optus has also purchased “more capacity” on the NBN network, with the view that this should alleviate some of the congestion problems during peak time.

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