Dodo, iPrimus misled customers with exaggerated NBN speed claims

Dodo and iPrimus have been slugged a combined $2.5 million for misleading NBN speed claims, having “cherrypicked” its fastest possible network capability while ignoring the slower pace many of its customers endured.

The Australian Competition and Consumer Commission took the Vocus Group-owned telcos to the Federal Court, and both admitted that their “typical evening speed” claims made between March 2018 and April 2019 were misleading because they were not based on an appropriate testing methodology.

“Accurate information about broadband speeds, particularly during the busy period when consumers are most likely to use their services, is essential for consumers to be able to compare broadband offers and pick the best service for their needs,” ACCC chair Rod Sims said.

“These misleading speed claims meant consumers could not accurately compare different offerings and make an informed choice about their broadband provider.”

The ACCC said Vocus Group’s “flawed” methodology was inconsistent with the regulator’s “clear” broadband speed claims guidance.

It was also inconsistent with Australian Consumer Law, under which representations about future performance are considered misleading if they are not based on reasonable grounds.

Before handing down a $1.5 million penalty to Dodo and a $1 million penalty to Primus, Justice Bernard Murphy noted the companies “chose not to adopt the methodology proposed as industry best practice by the ACCC” and instead used its own methodology, which “had a number of deficiencies”.

“That is material to the penalties imposed,” Justice Murphy said.

The ACCC said Dodo and iPrimus co-operated with its investigation, admitted liability and agreed to make joint submissions to the court in relation to penalties and other orders.

It’s not the first time the companies have been pinged by the ACCC.

In 2018, Dodo, iPrimus and another Vocus-owned outfit Commander undertook to offer remedies to thousands of customers for advertising NBN speed plans that could not be delivered between October 2015 and June 2017.

Vocus is Australia’s fourth biggest telecommunications provider, with 5.2 per cent overall market share of consumer NBN services and 436,000 retail broadband customers.

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