'Vague' speed claims confuse 80 percent of broadband users: ACCC

The competition watchdog is cracking down on the use of "vague" broadband performance claims by internet service providers after finding 80 percent of consumers are confused about internet speeds.

The ACCC has been reviewing ISPs' broadband speed marketing since July last year, following a 48 percent jump in complaints about slow speeds to the Telecommunications Industry Ombudsman.

Its goal was to promote better practices in the broadband market by pressuring telcos to publish realistic data speeds achievable on their network at any given time.

It has today released six principles [pdf] intended to ensure speed claims "aren't misleading under the Australian Consumer Law".

The ACCC said it found during its consultation that 80 percent of the 390 consumers who responded were confused about broadband speeds and wanted to be able to more easily compare information from different ISPs.

“The ACCC is concerned that the use of vague speed claims is not providing consumers accurate, comparable, or useful information. Four out of five consumers have trouble comparing broadband speeds and this is causing a high level of complaints, confusion, and dissatisfaction,” ACCC chairman Rod Sims said in a statement.

Its six principles are just the first step in the process: the ACCC said it would publish a more detailed best practice guide for broadband speeds advertising "in the coming months" following further discussions with industry.

It is also still talking to the federal government about potentially introducing a monitoring and reporting program for fixed broadband performance.

For now, the six principles ask that ISPs provide accurate information about "typical busy period speeds" that a consumer can expect to receive, and refrain from advertising wholesale or theoretical speeds.

ISPs should also provide "accurate and sufficiently prominent" information about how any promoted applications - like video streaming - will perform, and should disclose to consumers known factors that will impact service performance.

The ACCC also said information on broadband performance should be presented in a standard format that can be easily understood and recognised.