ACCC takes Telstra to court over Belong’s misleading NBN speeds

Telstra is in hot water with the Australian Competition and Consumer Commission (ACCC), but this time for its subsidiary telco brand, Belong, which offers both NBN and mobile phone services.

The ACCC has initiated proceedings in the Federal Court against Telstra for allegedly making misleading representations to Belong’s residential customers over the speeds available to them on their NBN plan.

This comes just a month after Telstra, along with TPG and Optus, were ordered to pay fines for misleading customers with Fibre To The Node (FTTN) connections about the NBN speeds available to them at their home.

ACCC: Telstra should take its obligations to customers seriously

The action has been taken against Belong (which is owned by Telstra) in regards to the telco’s decision to change which version of the NBN 100 plan was offered to customers without notifying customers of the change.

Initially Belong had offered NBN 100 with 40Mbps upload speeds (as was previously the standard upload speed), but then switched to NBN 100 with 20Mbps upload speeds in October and November 2020.

The NBN 100/20 speed tier was introduced by NBN Co in early 2020, as it is a cheaper service for retailers than the 100/40Mbps speed. Some retailers now only offer the 100/20 version of the NBN 100 speed to customers and — at the time of the new speed launch — took it as an opportunity to provide a fast download speed at a lesser cost to the customer.

The ACCC also notes that not only did Telstra not notify customers of this speed change, but it did not lower the charges, despite the 100/20Mbps speed costing the telco $7 less per month than the 100/40Mbps service.

ACCC Commissioner Liza Carver said, “We allege 8,897 consumers who signed up to a Belong NBN plan between May 2017 and October 2020 were affected by this change and deprived of the opportunity to make an informed decision about their internet service.”

Telstra acknowledged this error in early 2021 and provided customers with a one-off $90 credit, and the telco reiterates that it self-reported the issue to the ACCC. However, the ACCC claims that there are still Belong customers who are yet to be notified.

“We allege that more than 6,300 Belong customers have still not been informed by Telstra that their plan has changed to a lower maximum upload speed, and that Telstra continues to represent to them that the Belong broadband service supplied to them has not been altered,” Ms Carver said.

“We expect a company of Telstra’s size and experience to take their obligations under the Australian Consumer Law very seriously, including those prohibiting misleading or deceptive conduct and false or misleading representations.”

A Telstra spokesperson told Canstar Blue, “We don’t agree with the ACCC’s views on this issue and look forward to resolving it. When our communications with some of our customers have fallen short, we’ve let them know and made things right.”

Telstra states in its general customer terms that customers may be migrated to an alternative service with ‘reasonable notice’; if you are not satisfied with this change of service or plan, you’ll be able to cancel with any early termination fees waived.

Canstar Blue’s Utilities Editor Tara Donnelly said, “This is one of several recent missteps by Telstra regarding NBN plan speeds, although the telco is far from the only provider to be singled out this year for misleading its broadband customers.

“While the difference in upload speeds may not be immediately noticeable to many Belong customers, it still means that affected Belong users weren’t able to decide for themselves whether to stick with the service, or shop around for another plan.”

Check your internet speed

What is the difference between NBN 100/40Mbps and 100/20Mbps speeds?

The NBN 100 speed tier is one of the fastest speed tiers available to many Aussie households (depending on your home’s NBN connection type) and provides a good solution for larger households with high internet needs such as HD video streaming, online gaming and more.

Originally, NBN 100 was only offered with the 100Mbps download speeds and 40Mbps upload speeds. However, now there is a choice between the initial NBN 100 speed tier and a speed with 100Mbps download and 20Mbps upload speeds.

The higher 40Mbps upload speed will be more useful to anyone who regularly needs to upload files; for example, anyone working from home, or content creators uploading videos to YouTube. For many, the 100Mbps download will be more important than the upload speed, so a 20Mbps upload speed might be adequate for their needs. Therefore, they might be better off with a slightly cheaper NBN 100 plan with those slower upload speeds.

Many telcos now simply offer the NBN 100/20 speed tier as standard, however some providers will offer both 100/40 and 100/20 speeds. If you need that additional upload speed, it’s worth shopping around and checking any NBN 100 plans to see what upload speed is being offered. If you’re unsure about your current service, or any NBN service you’re looking at signing up to, you can always get in touch with the provider for further information.

“Although the jargon around NBN can be confusing, understanding the speeds and features included in your plan is the best defense against being overcharged, or ending up on a plan that isn’t right for your needs. Customers shouldn’t be afraid to question their telco if their NBN speed or performance isn’t up to scratch, especially with so many providers now offering competitive prices and improved busy hour speeds,” said Ms Donnelly.

Compare NBN plans

If you’re looking for a new NBN plan, or curious to see if you can get a better deal with a different provider, the below table shows a range of NBN plans across four speed tiers. Switch between the tabs to compare plans on the different speed tiers.