Home Telecoms & NBN Court action against Optus over allegations of misleading customers on NBN

Court action against Optus over allegations of misleading customers on NBN

The competition regulator the ACCC has hauled Australia’s second largest telco Optus before the Federal Court, alleging the company misled customers about the need to move quickly from its existing HFC network to the National Broadband Network (NBN).

The Australian Competition and Consumer Commission (ACCC) has instituted the proceedings in the court alleging that between October 2015 and March 2017, Optus made false and misleading representations by writing to its customers to advise it would disconnect their HFC service within a specified time period as the NBN was coming to their area.

The ACC says, however, that the timeframes were earlier than Optus was contractually allowed to cancel the customers’ services.

“We allege that Optus’ misrepresentations put pressure on customers to move to the NBN sooner than they were required to. This is particularly concerning as Optus received a significant financial payment from NBN Co for each customer that moved from its cable network to the NBN,” ACCC Chairman Rod Sims said.

The ACCC has also alleged that between October 2015 and September 2016, Optus – Australia’s third largest provider of NBN internet services - misled some of its customers about their options for purchasing an NBN plan.

“Optus created the impression that its customers were required to obtain NBN services from Optus, when they could have chosen to switch to any internet service provider,” Sims said.

“We are also concerned that Optus cut off some of its customers’ internet services when it had no contractual right to do so. Telephone and internet are essential utilities and it is unacceptable for Optus to treat its customers this way.

“As the NBN rollout continues throughout Australia, people will be making decisions about which provider to go with. ISPs must not mislead consumers when competing for business. We are keeping a close eye on this sector and will take action where we see wrongdoing.”

The ACCC is seeking declarations, injunctions, pecuniary penalties, a publication order, compliance orders and costs through its Federal Court action.

The ACCC’s investigation commenced following complaints and media reports that Optus had sent communications to its customers stating that their services would be disconnected  in as little as 30 days.

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Peter Dinham

Peter Dinham is a co-founder of iTWire and a 35-year veteran journalist and corporate communications consultant. He has worked as a journalist in all forms of media – newspapers/magazines, radio, television, press agency and now, online – including with the Canberra Times, The Examiner (Tasmania), the ABC and AAP-Reuters. As a freelance journalist he also had articles published in Australian and overseas magazines. He worked in the corporate communications/public relations sector, in-house with an airline, and as a senior executive in Australia of the world’s largest communications consultancy, Burson-Marsteller. He also ran his own communications consultancy and was a co-founder in Australia of the global photographic agency, the Image Bank (now Getty Images).