NBN refunds on offer

Telstra admits false speed promise

TELSTRA has offered to compensate 42,000 customers after failing to provide customers with the fast National Broadband Network speeds they promised.

The telco will offer remedies, including refunds, to those who purchased internet services through both Telstra and Belong brands between September 2015 and November this year, after admitting it may have breached consumer law by promoting NBN speeds that it was not capable of delivering.

An Australian Competition and Consumer Commission investigation found many of Telstra’s customers could not receive the top speed of their plan, nor could they receive the maximum speed of a lower-speed plan.

The investigation was prompted by an alert from Telstra to the ACCC that about 9000 of its customers on two of its plans could not receive speeds above a lower-speed plan.

Telstra said not all homes can receive top speeds because of underlying technology being rolled out by NBN Co as well as other factors such as purchasing connectivity capacity.

Telstra group executive of consumer and small business Vicki Brady said it was not possible to accurately determine what speed the NBN can deliver to a customer prior to connection. She said remedial action would apply to less than five per cent of Telstra’s NBNcustomers.

“The majority of our customers have a service that can deliver the speeds of the plan they’ve chosen, but there’s a small group whose NBN connection isn’t capable of delivering the top speeds,” Ms Brady said.

Telstra admitted it was likely to have breached the Australian Consumer Law by engaging in misleading or deception conduct and making false or misleading representations.

Affected customers will be offered the option of a costless exit from their contract and a refund, moving to a different speed plan and receiving a refund, or remaining on their current plan and not receiving a refund.

ACCC chairman Rod Sims said he was pleased Telstra had reported the issue to the ACCC, but noted it wasn’t just an issue for Telstra.

“It is an industry problem where consumers are often not getting the speeds they are paying for,” he said yesterday.

“We will continue to investigate other retail service providers selling broadband plans over the NBN and take enforcement action where appropriate.”