The Australian Communications and Media Authority (ACMA) has issued Telstra with a Remedial Direction after it found it had failed to inform customers it was under-delivering on internet speeds.
ACMA found Telstra had failed to suitably notify almost 50,000 customers that the maximum speeds advertised in its internet plan were not attainable with the NBN infrastructure available to them.
Under ACMA rules, telcos must verify maximum internet speeds and notify customers when speeds cannot meet those advertised in their plan.
ACMA said, in these circumstances, customers were entitled to move to a lower speed tier plan at a lower price or exit the contract without cost.
Chair of ACMA, Nerida O’Loughlin said the Remedial Direction meant Telstra must commission an independent audit of the systems it has in place to notify customers of their maximum attainable speeds.
“ACMA is very concerned with this conduct as these customers have been paying for a level of service they were not receiving,” Ms O’Loughlin said.
“Telstra denied these customers the opportunity to downgrade their plan or exit their contract.”
She said Telstra was in the process of providing remedies to the impacted customers, including refunds where appropriate, and it was reporting regularly to ACMA on its refunding progress.
“We will take a very close look at the results of the independent audit to make sure we are satisfied that the action Telstra has taken will adequately address the flaws that led to the problems,” Ms O’Loughlin said.
If Telstra failed to comply with its Remedial Direction, it could face penalties of up to $10 million, she said.
