ACCC claims broadband speed audit provides needed oversight

ACCC claims broadband speed audit provides needed oversight

Summary: The ACCC is forging ahead with a proposal to audit broadband speeds, while telcos believe that the Australian competition watchdog is targeting a non-issue.

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The Australian Competition and Consumer Commission (ACCC) has rejected claims from telcos that an audit of Australia's broadband speeds is unnecessary.

In August, the ACCC announced a proposal to develop a monitoring system that would report back to the authority on the types of speeds achievable on Australian fixed networks. The proposal was to include a device installed in the premises of between 1,000 and 12,000 users across Australia to test out the speeds on the network.

The aim, the ACCC said, is to ensure that the claims the telcos are making about the speeds on offer are accurate.

The proposal was widely rejected by the large ISPs, with most questioning the commission's rationale behind such a proposal when it had not demonstrated a need for the testing. Telstra said more work needs to be done to define the problem.

"Telstra is concerned that the ACCC has provided little information about the public policy thinking behind the proposal. The problem is not clearly defined, and it appears that little consideration has been given to the various policy options that might be available to address an identified problem, if one is found to exist," Telstra said in its submission.

"As a result, Telstra is concerned that the specific broadband performance monitoring and reporting program being proposed could lead to a sub-optimal outcome for industry — in terms of costs — and for consumers, who may place reliance on the information reported when choosing an ISP."

Optus said the ACCC has not proven that consumers are currently dissatisfied with the marketing and promotion of speed claims by ISPs.

"Further, customers already have access to a range of online tools that can provide accurate and real-time information on the speed of their service," Optus said.

The Communications Alliance said that in its discussion with the ACCC in September, the ACCC confirmed that it has not conducted any research to determine consumer detriment from the lack of information on broadband speeds.

The alliance questioned why the ACCC is seeking extra funding from the federal government to undertake the proposal.

"Communications Alliance questions whether this is the best use of scarce national funds, particularly in circumstance where — in industry's view — a compelling case for a scheme of this kind has not yet been made, and more cost-effective alternative solutions already exist and/or may be developed."

The proposal does have the backing of the government-owned company rolling out the National Broadband Network (NBN), NBN Co, which said that probe-based testing would produce reliable and useful measurements of the performance of retail broadband services.

Google also said in its submission that it supports broadband measurement as a tool for greater transparency.

"Google believes that the availability of clear and accurate information about broadband internet access services is essential for a free and open internet. Markets rely on information in order to function properly," Google said.

"Transparency systems are becoming an important regulatory tool, so that policy makers can assist in improving the information flows between service providers and users."

In response, the ACCC released an open letter stating that none of the issues raised call into question the potential for implementing such a program. The commission said that contrary to the objections of the telcos, it believes that the broadband market is not competitive enough, and is in need of additional oversight.

"The ACCC considers that the national retail market for the supply of fixed broadband services is not effectively competitive overall. Whilst the retail broadband market exhibits some features of a competitive market, the asymmetry of information between [ISPs] and consumers on service performance prior to contracting is a form of market failure."

The availability of information through broadband comparison sites is also too reliant on information provided by the ISPs, the ACCC said.

"Broadband comparison sites in Australia essentially replicate the information provided by [ISPs] in their marketing materials on their websites in order to give consumers a 'one-stop shop' for choosing a service," the ACCC said, with most websites focusing on price, download quotas, and headline speeds.

"No robust information on the relative performance of different [ISP] services is available."

The ACCC also singled out broadband enthusiast website Whirlpool as being unreliable because the advice given on the site about speeds is "subjective" and would not provide a good overall picture of the performance of an ISP.

The commission said it would continue working with stakeholder groups and look to release a position paper on the proposal in early 2014.

Topics: Telcos, Broadband, NBN, Australia

About

Armed with a degree in Computer Science and a Masters in Journalism, Josh keeps a close eye on the telecommunications industry, the National Broadband Network, and all the goings on in government IT.

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4 comments
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  • Spot on ACCC

    This needs to happen.
    NZO893
  • Agreed NZO

    BUT if we spend money to do this, the question is what are they going to do with the results? If the answer = nothing, then it IS wasted money and I think they shouldn't bother. If it can be used to target bad areas which are then priority build sites for NBN for example then absolutely go ahead. HOWEVER, 12,000 users across Australia is NOTHING. I think they'd be better off spending that money on developing a web portal people can go to that tests and reports the speed back to the ACCC (much like speedtest.net). Then maybe a TV campaign to ask people to do it. I'm sure you'll get a hell of a lot more than 12,000 people from a far bigger geographical area.
    Ramrunner-5dd3e
  • Sinking sync speeds

    Appalling copper sees our best sync speed of 2.5 Mbps progressively resync 3-4 times over 24 hours, to 130 Kbps or even 80 Kbps. Yes, all the gear is high-end, central splitter, etc. It is just the rotten copper, which sees s/n ratio drop for periods every day leading to resync. We'll have one of those monitors, please, ACCC.
    umbria
  • We need the ACCC to do independent audits like Singapore and fine carriers

    It is about time the ACCC is acting. In Singapore the equivalent body, Infocomm Authority of Singapore (IDA) does spot mobile checks "indoors" all over the city and fines the carriers for not performing (as well as the negative media attention).

    All three Australian carriers have almost stopped investing in 3G capacity or expansion as it costs 25% more to run a 3G network compared to 4G. Secondly the latency, the broadband speeds and customer experience is twice as good on 4G as to 3G when it comes to doing almost anything on data.

    Unfortunately at them moment apart from Telstra who else can we go to for high speed data with 4G/LTE (which is were all the carriers are investing, some carrier(s) a lot more than others) ??

    Statistics show 4G is being used indoors 90% most of the time by smartphones.

    Telstra online maps show where there is 4G "indoor" coverage and it is almost everywhere in every capital city (they also state they will also have 85% population across Australia 4G coverage by December this year - 2013). With 4G you receive a fantastic broadband experience with Telstra (even better than your ADSL at home), however Telstra knows they have the biggest Australia wide 4G footprint and the best 4G indoors experience (which then also gives you better indoor speeds) however they give they then slug customers by giving customer 70% less data allowance compared to their competitors (ie only 1GB with a $60 plan). This means if you use another 1GB which is highly likely on 4G, then Telstra will charge another outrageous $102 for 1GB on top of your $60 plan!! ($0.10MB if you go over your plan allocation)

    Vodafone is at least being honest with their coverage maps and show "indoor" 4G coverage. If you have a close look at their maps they only have some capital cities with 4G. Secondly the capital cities which have 4G, their 4G coverage indoors maps show Vodafone 4G indoor coverage is very patchy.. So most of the time you are on 'H" 3G HSPA which is much slower for uploads and has more than double the latency than 4G ( ie, latency, if you type in an address in your web browser and time it takes for your handset to tell the network what it wants to do even before downloading, so in other words, with high latency,the download speed has nothing to do with why your browsing page takes so long to start downloading). Vodafone has the best 4G prices (~$60 for 3GB data) which more realistic with 4G consumption.

    Unfortunately Optus is the least transparent with their 4G (and 3G) maps because rather than being honest like Telstra and Vodafone they use advertising tricks by showing all their capital cities are coloured in to show they have 4G almost everywhere in the cities however in fine print under all their 4G and 3G maps they state "4G outdoor" and "3G outdoor". Once you start using your 4G Optus smartphone "indoors" it is only a little better than Vodafone as the Optus 4G "indoor coverage" is still very patchy.
    What is even worse and more alarming is Optus is now only selling 4Gplus phones and the 4Gplus network is very patchy indoors (worse than the Optus standard 4G network) and in most cases you will only receive 1bar on 4Gplus when indoors or in the high rise apartment or office. It beggars believe why Optus would force their customers on 4Gplus and destroy the 4G customer experience when they are in the very infancy of the 4Gplus rollout?? I would not buy a 4Gplus phone for at least another 12 months with Optus until the 4G plus network works indoors.
    Optus has middle of the road 4G prices (~$60 for 2GB data) however once you really start using 4G you will be using more than 2GB of data. Optus do have an automatic top up if you go over 2GB and you get charged another $10 for every 800 to 1GB over your plan allocation (depending on plan you're on). This means for 3GB may cost around $70.

    So inside the capital cities there is no competition. You go to Telstra and use their flawless 4G network almost anywhere inside your house/high rise and office however will be forced to go on a $100 plan to avoid being hit with $102 per 1GB bill shock every time you go over by another GB (gigbite). On the other hand because their is no audit by the ACCC on the "real indoor" 4G coverage (not outdoor), both Vodafone and Optus try and lure customers with cheap plans which mean nothing is is useless if you can't access 4G and stuck on slow 3G.

    The second problem the ACCC needs to tackle is both Vodafone and Optus have no 4G and very little "H" HSPA (high speed) 3G outside the capital cities in all the Australian coastal and regional cities and towns. Both show lots of colour in their regional maps but this only usable mainly for voice calls and possibly very high latency (ie slow) and /or very slow mobile broadband speeds in most regional areas (not necessarily remote areas). This means when I go to different coastal beaches (in any state) for holidays or visiting family and friends I have no choice but to use Telstra 4G or HSPA (Telstra state they will have 85% the national population covered by December 2013 with 4G and remainder, to 97% national population coverage by December 2014). So outside capital cities in all regional areas of Australia, both Vodafone and Optus show their maps have 3G mobile broadband coverage (no 4G) however HSPA 3G is not for indoors coverage which is where you use your smartphone??

    Since nearly all the phones sold are broadband smartphones, the ACCC needs to force the carriers to show actual mobile 'broadband' coverage 'indoors' in order to level the playing field to allow customers to compare apples with apples (compare HSPA as well as 4G 'indoors with indoors' against all three carriers) well before the customer decides on the most competitive plan to choose. This will force the ACCC to force Vodafone and Optus to decide if they only want to advertise they only provide high speed mobile broadband for capital cities and only best efforts or only voice for the rest of the cities or regional areas in the rest of Australia.

    ACCC, bring in the Singaporean style referee , like Infocomm Authority of Singapore (IDA) on the spot fines to carriers for false indoor mobile broadband 4G coverage and false indoor 4G mobile broadband speeds !!!
    snoopy2020