Telstra in court for ‘misleading’ representations about Belong broadband speed

The ACCC has instituted Federal Court proceedings against Telstra for allegedly making false or misleading representations about upload speed to residential broadband customers of its cheaper brand, Belong.

In October and November 2020, Telstra migrated nearly 9000 customers who were on a Belong NBN plan with a maximum download speed of 100 megabits per second (Mbps) and a maximum upload speed of 40Mbps, to a service with a maximum upload speed of 20Mbps.

The ACCC alleges that Telstra failed to notify customers of the reduction in the upload speed, and did not lower their charges, even though the cost charged by NBN Co to Telstra was $7 a month less for the new service.

“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,” ACCC Commissioner Liza Carver said.

In March and April 2021 Telstra acknowledged this failure in respect of approximately 2,500 customers and provided them with a one-off $90 credit.

“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.

“In these circumstances, we are seeking a Court order requiring Telstra to pay compensation to consumers who, we allege, did not get the service they signed up for.”

Telstra’s general customer terms contain the following clause: ‘Our right to migrate your service: If we give you reasonable notice, we may migrate you to an alternative service or pricing plan. If you’re not satisfied with the alternative service or pricing plan, you can cancel your service and any ETCs [early termination charges] will be waived.’

“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,” Ms Carver said.

The ACCC is seeking declarations, penalties, consumer redress, costs and other orders.

CT Bureau