Australia: Optus admits to misleading advertisements on Internet speeds, delivering half the stated speeds

[The Age] Optus has been slashing broadband speeds to half the level advertised for customers who exceed their monthly download allowance.

Customers of Optus's "Naked" ADSL broadband plans have their internet speeds throttled down to 64kbps for the rest of the month once they exceed their 7GB, 15GB or 30GB monthly allowance.

This is half the speed of 128kbps that is listed in the terms and conditions published on the Optus website and about the same speed offered by ancient dial-up modems.

Many internet providers significantly reduce speeds for customers who download too much, rather than charging high fees for excess usage.

However, with Australians increasingly using the internet to consume rich media content, they are finding they are using all of their monthly data allowance more quickly than ever before.

They then have to make do for the rest of the month with greatly reduced internet speeds, so whether the speeds are capped at 64kbps or 128kbps is seen as an important consideration.

Optus admitted the false advertising, saying an error was made in the terms and conditions published on its website. The error has now been fixed.

It said all of its "Naked Broadband" customers would be "contacted directly to advise them of the error, offering them the opportunity to cancel their contract without penalty".

The discrepancy was first picked up by a reader of APC magazine, Michael Sanchez, who said he signed up to Optus broadband only because he thought his connection would be slowed just to 128kbps, which is enough for basic web access.

The Australian Competition and Consumer Commission did not respond to calls requesting comment.

However, at a communications conference in March, the regulator's chairman, Graeme Samuel, said he was "putting the telecommunications industry on notice".

"Misleading advertising, unfair contracts, inadequate disclosure and subscription scams are all in the ACCC's sights. Standards must improve or risk increased scrutiny and action," he said.

Optus admits false broadband advertising