With no prior warning or payment, Telstra is being sued for allegedly downgrading all of its Belong brand’s 100Mbps NBN customers to a plan with slower upload speeds.
Just under 8900 Belong subscribers, according to the Australian Competition and Consumer Commission (ACCC), allegedly had their plans changed from 100/40Mbps to 100/20Mbps, but only 2500 received a one-time $90 credit as compensation.
The ACCC claims that the remaining customers have still not been informed of their decreased upload speeds and is seeking a court order “requiring Telstra to pay compensation.”
According to the ACCC, “speed, and its link with price, is a crucial consideration when choosing and remaining on an internet service and is a key differentiating feature between plans and pricing,” in a brief statement [pdf] filed with the Federal Court.
According to the ACCC, it can be difficult, time-consuming, and complicated for residential customers to grasp the features of broadband services and the performance or quality attributes of the services they actually receive.
For consumers to make educated decisions about the services that may best suit their needs and budgets, both at the time they first acquire a service and throughout the period they acquire and pay for that service, accurate information about internet speed is crucial.
The 100/40Mbps tier was kept by NBN Co, and the faster upload speed was offered as an add-on speed enhancement.
Telstra foresaw the complexity that would result from having two 100Mbps household offerings at the time.
The case seems to test the extent to which so-called pass-through mechanisms should be present with regard to NBN pricing, specifically, how much of a reduction in wholesale prices should be passed on to the customer.
The issue has previously come up in relation to rebates and the amount of money that should be transferred from NBN Co to an internet provider to the end customer whose service is affected by a service level breach.
