Internode Pty Ltd

The Australian Competition and Consumer Commission (ACCC) has accepted a court enforceable undertaking from Internode Pty Ltd (Internode) in relation to claims about speeds available to consumers on its fibre-to-the-node (FTTN) and fibre-to-the-building (FTTB) broadband plans supplied over the National Broadband Network (NBN) that were likely to contravene sections 18, 29(1)(b) and 29(1)(g) of the Australian Consumer Law (ACL).

Internode, among other services, is a supplier of NBN services to consumers.

The relevant conduct

• Since 16 December 2015, Internode has offered NBN services to consumers with FTTN and FTTB connections. Internode offered the following speed plans:
  • 100 megabits per second (Mbps) download and 40 Mbps upload (100/40 Plan);
  • 50 Mbps download and 20 Mbps upload (50/20 Plan);
  • 25 Mbps download and 5 Mbps upload (25/5 Plan); and
  • 12 Mbps download and 1 Mbps upload (12/1 Plan),

    (collectively, the Speed Plans).

• Between 16 December 2015 and 30 June 2017, Internode promoted the Speed Plans online, on television, in newspapers and on radio. Internode’s promotion of the Speed Plans included statements such as “NBN Platinum: up to 100/40Mbps connection speeds”, which represented to consumers that their NBN connections could deliver speeds up to the maximum speed of their Speed Plan.
• In fact, Internode was not capable of delivering those speeds to many consumers, because those consumers did not have NBN connections capable of reaching those speeds.

The relevant undertaking

To address the ACCC’s concerns, Internode provided the ACCC with a section 87B undertaking which states that, among other things:

• Internode will contact current and former affected consumers by no later than 27 April 2018 by letter or email to explain the maximum speed they are able to receive, the types of remedies available and how to obtain a chosen remedy.
• The remedies available to a consumer depend on the consumer’s Speed Plan. Some options for consumers will include:
  • change to a plan of the consumer’s choice and receive a refund;
  • exit their plan (and any associated bundle) without cost and receive a refund; or
  • remain on their current plan with no refund.
• For the next three years, Internode will not represent that it can or will provide consumers with FTTN or FTTB connections with download and upload speeds at the maximum speeds specified in the consumer’s plan unless it also, within four weeks of the activation of a Speed Plan:
  • checks the maximum speed each consumer can receive; and
  • if the maximum speed a consumer can achieve is below the advertised maximum speed of the consumer’s Speed Plan, notifies the consumer and provide them with options to remedy the situation.

Background

• Internode is wholly owned by TPG Telecom Limited.
• On 20 December 2017, the ACCC accepted a court enforceable undertaking from TPG Internet Pty Ltd (TPG) on similar terms to the Internode undertaking. TPG is also wholly owned by TPG Telecom Limited. TPG’s court enforceable undertaking is available at: http://registers.accc.gov.au/content/index.phtml/itemId/1204847.
• On 19 March 2018, the ACCC accepted a court enforceable undertaking from iiNet Limited (iiNet) on similar terms to the Internode undertaking. iiNet is also wholly owned by TPG Telecom Limited. iiNet’s court enforceable undertaking is available at: www.accc.gov.au.
• The ACCC has previously accepted court enforceable undertakings from Telstra Corporation Limited (Telstra Corp) and Optus Internet Pty Limited (Optus) in relation to conduct similar to the subject of the Internode undertaking. Telstra and Optus each made representations about speeds available to consumers on their respective NBN FTTN and FTTB broadband plans that were likely to contravene the ACL.
• Telstra’s court enforceable undertaking was accepted on 7 November 2017, and is available at:  http://registers.accc.gov.au/content/index.phtml/itemId/1204319.
• Optus’ court enforceable undertaking was accepted on 11 December 2017, and is available at: http://registers.accc.gov.au/content/index.phtml/itemId/1204733