Optus likely misled 8700 NBN customers over internet speeds

More than 20% of its 100/40Mbps users weren't getting speeds half as fast.

Refunds, discounts and a waiver for contract cancellations are being offered to nearly 9000 Optus customers who were paying for NBN speeds they couldn't get.

This makes Optus the second major telco to offer a redress program for advertising internet speeds that were likely misleading, after Telstra announced it will compensate 42,000 of its customers in November.

The programs come after the industry ombudsman revealed record complaints were lodged against the NBN, resulting in an inquiry examining the network's quality and fuelling concerns the $49 billion network will fall obsolete when the next generation of mobile technology arrives.

Optus admitted in an enforceable undertaking accepted by the competition watchdog that it likely engaged in conduct that likely contravened Australian Consumer Law, and that it did so from September 2015 through to the end of June 2017.

The carrier advertised fibre-to-the-node (FTTN) and fibre-to-the-building (FTTB) plans to 8700 customers where they could not achieve the internet speeds advertised.

Out of the 8700 customers that were likely misled by Optus, 5430 were on a 100/40 Mbps connection, 1519 were on 50/20Mbps, and 1381 were on 25/5Mbps.

More than a fifth of the customers who signed up to Optus' 100/40Mbps plan wouldn't receive the 50/20Mbps speeds promoted on the plan below it, says Rod Sims, chair of the Australian Competition and Consumer Commission (ACCC).

"Worryingly, many affected Optus FTTN customers could not even receive the maximum speed of a lower-tier plan," says Sims. "This is a concerning trend we have seen throughout the industry and we are working to fix this."

The telecommunications carrier has agreed to check with customers who sign up to an NBN connection within four weeks to make sure they're getting the speeds they were promised.

Customers entitled to a refund, discounted speed plans, a change in plan and a waiver of their contract cancellation fee will be contacted by Optus by 2 March 2018.

The watchdog will continue to watch broadband providers closely, says ACCC chair Sims.

"We are continuing to investigate other retail service providers selling NBN broadband plans, and will take enforcement action if we consider that they are not delivering on their promises to customers."

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