iiNet and Internode fall to NBN speed claims compensation hammer

A total of 11,000 iiNet and Internode customers are to be refunded after the providers did not provide consumers with the NBN speeds they were paying for between 2015 and 2017.
Written by Corinne Reichert, Contributor

iiNet and Internode are the latest to fall to the Australian Competition and Consumer Commission (ACCC)'s quest to force telcos into compensating National Broadband Network (NBN) customers who have been paying for speeds they are not receiving.

In total, around 8,000 iiNet customers and 3,000 Internode customers will be offered remedies, including moving to a lower-speed plan with a refund, or exiting their plan with a refund and no fees.

According to the ACCC, between 2015 and 2017, both providers engaged in misleading or deceptive conduct or made false or misleading representations -- iiNet advertised its 100Mbps plan as "up to 100Mbps: This is our fastest option and is sure to impress", and Internode advertised it as "NBN Platinum: up to 100/40 Mbps".

However, 7,621 or 64 percent of customers on a 100/40Mbps [PDF] iiNet fibre-to-the-node (FttN) plan could not receive speeds of 100Mbps; of these, 1,925 or 25 percent could also not receive 50/20Mbps speeds, 126 or 2 percent could not reach 25/5Mbps, and six customers could not attain 12/1Mbps.

Of the FttN iiNet customers paying for a 25/5Mbps plan, meanwhile, 742 could not reach these speeds, while 23 could not reach 12/1Mbps. Twelve customers paying for the 12/1Mbps speed tier could not reach these speeds.

Across its fibre-to-the-basement (FttB) customers, 75 who were paying for 100/40Mbps could not reach these speeds; while five customers paying for 12/5Mbps could not reach 25Mbps, and two of those could not even reach 12/1Mbps.

On Internode's 100/40Mbps plan, 1,720 or 34 percent of FttN customers [PDF] could not receive 100Mbps speeds, with 479 of these also unable to receive 50/20Mbps speeds, 36 of these unable to receive 25/5Mbps, and one unable to receive 12/1Mbps.

Across the 50/20Mbps speed tier, 1,078 Internode customers could not attain these speeds, 47 of which could not reach 25/5Mbps, with one unable to reach 12/1Mbps. Of those paying for its 25/5Mbps plan, 207 could not reach these speeds; and of those paying for 12/1Mbps, five could not attain these.

Internode's FttB customers were less affected: 78 of those paying for 100/40Mbps could not reach these speeds, with 26 of those unable to reach 50/20Mbps and two of those unable to attain 25/5Mbps; 26 FttB customers paying for 50/20Mbps speeds could not reach 50/20; and 13 FttB customers paying for 25/5Mbps could not attain their highest speeds.

"Internet service providers must provide accurate information to customers about the speeds they can access on the NBN," ACCC Commissioner Sarah Court said.

"Many customers could not reach the maximum speeds advertised by iiNet and Internode because their NBN connection was not capable of delivering it. Some customers couldn't even receive the maximum limit of lower-speed plans."

Customers will be contacted by April 27 and told what their maximum speed is, as well as what their compensation options are.

Internode and iiNet are both owned by TPG, which was itself forced by the ACCC to refund 8,000 NBN customers in December.

This followed Optus entering a court-enforceable undertaking to refund thousands of FttN and FttB customers who were sold speeds not technically possible on their NBN connection; and Telstra having to refund around 42,000 customers for the same issue.

ACCC Chair Rod Sims last month said the consumer watchdog had labelled broadband consumer issues as a major focus for 2018, warning NBN retailers that it would continue stepping in when they do not provide the speeds consumers are paying for.

"Consumer issues in the provision of broadband services, including addressing misleading speed claims and statements made during the transition to the NBN, have become one of the ACCC's most prominent issues in the past two years and highlights the importance of both our consumer and competition focus," Sims said in February.

"The first report of the ACCC's Measuring Broadband Australia program will be released shortly, and our commitment to truth in advertising related to broadband speeds is making it easier for Australians to choose a service provider.

"You have seen a number of ACCC enforcement actions in 2017, and can expect further interventions this year."

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