ACCC warns mobile operators against overstating wireless data rates

Stuart Corner
Wednesday, 30 September 2009 18:08

IT Industry - Strategy

The ACCC has told mobile operators that they must not advertise data rates on wireless broadband services in excess of those generally achievable or likely to be achieved by consumers using the network.

The ACCC has issued an information paper to assist companies in complying with the consumer protection provisions in the Trade Practices Act 1974 when advertising mobile and wireless broadband services.

"The ACCC is concerned by companies over-promising and under-delivering the speeds available on mobile and wireless Internet, particularly in the context of network upgrades and increasing wireless Internet subscriptions," ACCC chairman, Graeme Samuel, said. The paper warns companies that they must not advertise 'maximum', 'up to' or 'peak network' speeds if those speeds are not generally achievable or likely to be achieved by consumers using the network.

The ACCC says it "considers that any Internet speed claims made by companies should be based on appropriate tests of network performance that show the speeds that can and will generally be achieved by consumers using the network on a regular basis."

Companies "should also prominently state the factors affecting mobile and wireless Internet speeds including congestion and location, given that different speeds will be achieved at different times depending on these variables."

"The Information Paper contains an Industry Checklist to assist companies comply with the law and we urge them to use it before advertising any existing or new mobile or wireless Internet services," Samuel said.

The Information Paper is part of a broader ACCC crackdown on advertising in the telecommunications industry. Telstra, Vodafone Hutchinson and Optus (including Virgin) recently gave a court-enforceable undertaking to the ACCC that they would review and improve their advertising practices so that consumers are better informed about telecommunications products and services.

This undertaking includes an agreement not to advertise and promote headline broadband speeds that represent to consumers that the speeds are available in circumstances where they are not generally available to consumers.