Australia’s three largest telcos are in hot water with the ACCC, with Telstra, Optus and TPG Telecom fined a total of $33.5 million for making what the watchdog has called ‘misleading statements about NBN speeds’.
As a result of proceedings brought about by the ACCC in August 2021, Telstra, Optus and TPG have been ordered by the Federal Court to pay penalties totalling $33.5 million after they each admitted making false or misleading representations to consumers when promoting NBN 50Mbps or 100Mbps fibre to the node (FTTN) plans.
According to the ACCC, by making statements on their websites, in emails to consumers or in telesales, Telstra, Optus and TPG each promised to tell consumers within a reasonable timeframe if the speeds they were paying for could not be reached on their NBN connections.
They each also said they would offer these consumers options, including to move to a cheaper plan with a refund, if they could not achieve the maximum speed on their plans.
However, the ACCC said all three of them separately admitted that their statements were false or misleading, which is in breach of the Australian Consumer Law. The watchdog said this occurred because Telstra, Optus and TPG each did not have adequate systems, processes and policies in place to ensure they would do what they said they would.
Breaking it down by telco, Telstra was ordered to pay $15 million, Optus was $13.5 million and TPG had to shell out $5 million in penalties.
The ACCC said the issue affected 120,000 consumers in the period spanning 2019-2020.
According to the watchdog, Telstra, Optus and TPG each admitted that by failing to notify consumers whose maximum attainable speeds were lower than the speed of their purchased plan, they had falsely represented to those consumers that their NBN connections were capable of attaining the higher speeds.
Telstra’s acting consumer and small business group executive Amanda Hutton shared her disappointment that Australia’s incumbent telco had made these errors and confirmed Telstra had gone through an extensive remediation and refund process and taken a number of steps to ensure regulatory obligations are better met.
“While in no way trying to diminish the fact that we have not met our commitments here, the fact that the three biggest retailers of NBN services have all suffered the same fate reinforces the urgent need for Australia to fix NBN pricing and service quality once and for all. The way Australia’s broadband market is regulated is simply not working,” she added.
“We’re committed to improving our approach wherever we can and delivering better experiences for our customers, but there are improvements to be made on the wholesale side too.”
Optus, meanwhile, told Gizmodo Australia it has taken significant steps since this incident occurred in 2019 to improve its processes and how it delivers for customers.
“We have made changes to our processes to address the concerns raised by these proceedings and to address issues arising from NBN’s performance limitations,” the spokesperson added.
Similarly, a TPG spokesperson said the telco undertook a remediation program last year where it contacted all affected customers and offered refunds to those NBN FTTN customers who were eligible.
“Over the last year TPG has implemented several changes to improve its systems and processes to help ensure these issues do not occur again,” they said.
Telstra, Optus, and TPG have each implemented remediation programs and have already contacted impacted customers to provide refunds.
This article has been updated since it was first published.