Confusion about broadband claims prompts ACCC guidance

The ACCC consultation on fixed broadband speeds has found eighty percent of consumers are confused and want broadband speed information to be presented in a simple, standardised format to enable them to easily compare offers.

The ACCC has published principles to help ensure internet service providers’ claims about broadband speeds aren’t misleading under the Australian Consumer Law.

“The ACCC is concerned that the use of vague speed claims is not providing consumers accurate, comparable, or useful information. Four out of five consumers have trouble comparing broadband speeds and this is causing a high level of complaints, confusion, and dissatisfaction,” ACCC Chairman Rod Sims said.

The ACCC has developed six principles to guide ISPs on best practice marketing when it comes to broadband speeds, including how to make a clear statement on the typical speeds consumers can expect during busy hours.

The six principles are…

  1. Consumers should be provided with accurate information about typical busy period speeds that the average consumer on a broadband plan can expect to receive
  2. Wholesale network speeds or theoretical speeds taken from technical specifications should not be advertised without reference to typical busy period speeds
  3. Information about the performance of promoted applications should be accurate and sufficiently prominent
  4. Factors known to affect service performance should be disclosed to consumers
  5. Performance information should be presented in a manner that is easily comparable by consumers, for example by adopting standard descriptive terms that can be readily understood and recognised, and
  6. RSPs should have systems in place to diagnose and resolve broadband speed issues.

ISPs should make accurate information about broadband speeds available to consumers during sales processes and on their websites to help consumers compare plans, identify how various applications will perform (including video streaming), and provide customers with support if the service falls short of expected speeds.

“The ACCC has listened to the views of consumers and industry in identifying the fundamental areas of concern and developing principles by which to resolve them. The ACCC will now work with industry and issue more detailed guidelines to ensure they are able to use this framework to provide better information to their customers. It’s the first step of a longer-term plan to bring about meaningful change,” Mr Sims said.

“Greater transparency around broadband speeds will enable consumers to make clearer comparisons on product choices, further encourage ISPs to compete on speed and save consumers money.”

Complaints to the Telecommunications Industry Ombudsman about internet data speeds increased 48 per cent during 2015-16, making it the single largest issue for consumer complaints during the year. There are around 7 million fixed broadband subscribers and a further 6 million mobile broadband users (ABS, December 2015).

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