The Australian Competition and Consumer Commission has issued an Information Paper developed to assist Internet Service Providers comply with the Trade Practices Act 1974 when advertising broadband internet.
"The Information Paper is a proactive step by the ACCC to help ISPs comply with their obligations under the Act when advertising their broadband services and prevent consumers being misled as to the speeds achievable on various technologies," ACCC Chairman, Mr Graeme Samuel, said today.
ISPs must not make representations that are misleading or deceptive, or are likely to mislead or deceive.
Although directed at all broadband providers, the paper focuses primarily on ADSL2+ broadband services. ADSL2+ is a relatively new technology and is currently becoming available to more and more consumers.
"The paper contains an Industry Checklist and the aim is to encourage voluntary compliance," Mr Samuel said. "The ACCC strongly encourages ISPs to consider the issues on the checklist."
The paper draws attention to the industry practice of using hypothetical speeds as the basis of speed claims when these speeds are unlikely to be achieved in the real world. The ACCC considers that ISPs should have a reasonable basis, such as network tests, for any representation they make as to what speeds are available to future users of the network.
"The ACCC is concerned that ISPs are using 'hypothetical' speeds when these speeds are just that – available to the hypothetical consumer not necessarily the real world consumer. At the ACCC, we are concerned about the real-world consumer.
"The paper focuses on ADSL2+ because consumers may be attracted to these services by speed claims. As a new technology, consumers usually have less information than the provider of the service and may be misled by headline claims of hypothetical maximum speeds."
Theoretically, ADSL2+ can achieve rates of 24 Megabits per second. However, the speed consumers achieve is affected by a number of factors. Important factors affecting speed include distance from the exchange, electrical interference, the number of other users of the cable, hardware and software, wiring on the consumer's premises and even the website the consumer is trying to download.
"The purpose of the Information Paper is to encourage ISPs to provide adequate information to consumers on the factors affecting the speeds obtained and on the actual speeds or range of speeds that the ISP expects it will provide to future customers. This will enable consumers to be armed with complete and accurate service information when selecting a broadband provider."
Broadband Internet Speed Claims and the Trade Practices Act 1974 will be available on the ACCC website. The ACCC will also distribute copies directly to ADSL2+ service providers.
