Optus ordered to pay $1.5m for misleading customers in NBN transition

Advertisement

Optus has been slugged with a $1.5 million penalty for misleading some consumers about the transition process from their old internet connection to the National Broadband Network (NBN).

The Federal Court has ordered Optus to pay up after it told about 14,000 customers that their services would be disconnected if they did not transition within a certain timeframe. In some cases, they were given as little as just 30 days.

This took place from October 2015 to March 2017 and customers on the Optus HFC (cable) network were told that the telco could force disconnection if they did not transition to the NBN within a given timeframe.

Under the terms of its contract, Optus could not force disconnection within the timeframes it claimed.

The Australian Competition and Consumer Commission (ACCC) reports that Optus benefited by around $750,000 as a result of the conduct.

“Optus pressured customers by misrepresenting the time period in which services could be disconnected,” ACCC Chairman Rod Sims said.

“Businesses should not make false representations which distort customers’ decision making. This is particularly important when many Australians are moving to the NBN for the first time.

“It is illegal for businesses to mislead their customers and create a false impression through their communications.

“Today’s penalty serves as a warning to all businesses that such behaviour will be met with ACCC action.”

An Optus spokesperson said that in late 2016 the company had “made the decision to proactively migrate customers off Optus’ cable network to the NBN as soon as an area becomes serviceable”.

He said some customers were given “insufficient notice” and some were disconnected before they migrated to the NBN.

“Optus has acknowledged this was wrong and should not have occurred. Optus has written to affected customers apologising for this error and offering compensation to customers that had been disconnected without sufficient notice,” the spokesperson said.

“Optus has also established a revised set of migration processes for its cable customers that we believe will deliver customers the migration experience they expect.”

The news comes after Optus – and other telcos – were ordered to compensate some customers over slow or misleading NBN speeds in late 2017 and early 2018.

At the time, the ACCC found that nearly half of customers on the top-flight 100/40 Optus plan could not reach those maximum speeds, while around one in five could not even achieve half.

How long do I have to connect to the NBN?

It is a common misconception that users must switch from their old internet connection to the NBN straight away.

Usually, you will have up to 18 months from when the NBN is made available in your area before your old connection is switched off. However, as the completion date of the NBN looms large – scheduled for 2020 – this could change.

Canstar Blue research found that out of 1,693 NBN customers, 68 per cent switched to the new service straight away. Just 28 per cent also switched providers when they transitioned.

Nearly one in five – 18 per cent – also indicated they would like to ditch the NBN altogether for a mobile or private network.

Share this article

Advertisement