TPG Telecom's iiNet and Internode have been ordered to compensate more than 11,000 customers who were unable to achieve promised national broadband network speeds.
After an investigation by the Australian Competition and Consumer Commission, iiNet will offer compensation to 8000 people and Internode 3000 customers. All of the customers were on fibre to the node (FTTN) and fibre to the building (FTTB) NBN plans.
The companies say they will give customers options including moving to a lower speed tier with a refund, or leaving their plan without charge and getting a refund.
About 7620 of the customers were on FTTN and paying for iiNet’s highest speed tier of 100Mbps download, 40Mbps upload. Of these, more than 1900 could not achieve 50Mbps.
A third of Internode's affected customers were on FTTN connections and 100Mbps plans.
The majority of affected customers across both companies were on FTTN plans.
TPG and its brands have not offered a 25Mbps plan since mid-December, with the ACCC advising those who want a 25Mbps plan to consider exiting their contract and moving to another provider.
TPG dropped its 25Mbps plans as a result of the NBN Co’s discounts, which made 50Mbps plans the same price as 25Mbps.
ACCC commissioner Sarah Court said iiNet and Internode had admitted they had likely engaged in misleading or deceptive conduct, or made false or misleading representations by promoting and offering NBN plans with maximum speeds that were not deliverable. This was between 2015 and mid-2017.
“Internet service providers must provide accurate information to customers about the speeds they can access on the NBN," Ms Court said.
“Many customers could not reach the maximum speeds advertised by iiNet and Internode because their connection was not capable of delivering it.
“Some customers couldn’t even receive the maximum limit of lower speed plans,” she said.
Affected customers will be contacted by late-April, informing them of their maximum achievable speed and their options for compensation. The maximum speed is only known when customers connect to the NBN.
This is the fifth court-enforceable undertaking received by the ACCC from telcos about potentially misleading speed claims for NBN services.
TPG compensated 8000 customers in December due to NBN speed advertising. Telstra had to compensate 42,000 customers, and Optus had to do the same for 8700 customers.
The ACCC has been cracking down on “terrible” NBN advertising, with many major telcos updating their marketing in line with the industry guidance issued by the regulator.
TPG has been contacted for comment.
