Jul
11
2011

NBN gets warning over broadband speed advertising

The NBN has been warned that companies using its network should be careful how they advertise speeds to consumers

Australian retail and wholesale ISPs offering services over the National Broadband Network (NBN) have been advised by the country’s Competition & Consumer Commission (ACCC) to take care over how they advertise the speeds available.

The ACCC has published a guide that looks to make plain the issues that will prevent consumers from obtaining the theoretical maximum data rates of the NBN network. The document states that, “There is a high risk of consumers being misled by ‘up to’, ‘peak’ or ‘maximum’ data rate claims where they do not reflect typical end-user experiences.”

Therefore, the ACCC said, it expects ISPs to “provide meaningful and accurate information to consumers regarding the quality of service likely to be attainable by end-users in practice, both in advertisements and at the point of sale.”

The NBN ‘Information Paper’ explains that the factors known to the ISPs that are within its control – the limits on data transfer rates, the numbers of customers it will let share its local passive optical network (split ratio), the contention ratio, and the backhaul capacity available – should all be taken into account when advertising services.

Regarding the split ratio, the document states that this will be determed by the NBN Co. but will be known to ISPs. They will also know how much connectivity virtual circuit (CVC) capacity they have acquired from the NBN Co., which will affect the contention ratio.

For those companies reselling ISP services the document states that, “While retail ISPs acquiring Layer 3 FTTP services are unlikely to have any influence on the contention ratio adopted by their wholesale ISP or the available backhaul capacity for their service, such retailers should obtain relevant information from their wholesale ISP to assist them in accurately marketing their service.”

The publication of the document comes a week after Australian operator Optus was fined $5.2m for misleading advertising relating to its broadband internet plans.

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