Not so fast with that broadband claim

By LOIS CAIRNS - Sunday Star Times

TELSTRACLEAR misled consumers over its broadband speeds, the country's advertising watchdog has ruled.

Telecom complained to the Advertising Standards Authority (ASA) after the company's lawyers failed to get TelstraClear to agree to voluntarily pull a 30-second television ad which implied that its broadband was faster than that of other networks.

The controversial ad featured two animated characters – the modern and bright TC, representing TelstraClear, and Bill, representing the other networks, portrayed as an old-style telephone wearing a suit and tie.

TC, who is already online, says: "I'm streaming on TelstraClear broadband all right? And Bill...is not,", to which Bill responds, "Hang on. I'm not ready yet. It's hardly fair."

TC adds: "TelstraClear's broadband is incredibly fast."

Upset at the implication that TelstraClear's broadband was faster than its competitors' networks, particularly for streaming, Telecom informed TelstraClear that it considered the ad breached the Fair Trading Act and the Advertising Standards Authority Codes of Practice.

But TelstraClear refused to stop broadcasting the advertisement.

Taking its complaint to the ASA, Telecom said the advertisement was misleading as recent independent data from broadband monitoring company Epitiro showed that TelstraClear lagged behind the other main telecommunication networks in the key indicators of broadband speed, including download speed.

"TelstraClear in fact has the slowest broadband compared with the other major networks," Telecom told the ASA.

TelstraClear argued the Epitiro data was flawed. It said that in most instances it used the Telecom Wholesale network to provide internet access to its customers, as did nearly all ISPs in New Zealand. When TelstraClear used those copper access lines, the maximum speed it could provide was likely to be only as fast as that of any other provider and admittedly not faster, but where TelstraClear sold plans on its own fibre network in Wellington and Christchurch it offered dramatically faster speeds than any other ISP.

"If TelstraClear is as fast as any other provider where it uses Telecom's network, and faster than any other provider on its own network, TelstraClear must, on average, be faster than other provider," the company argued in its ASA submission.

The ASA's complaints board disagreed with TelstraClear's reasoning and upheld Telecom's complaint.

It said that because the ad was shown nationally, consumers were likely to infer that fast and consistent broadband streaming was available nationally when this was not the case. It ruled the ad contained statements and visual presentations likely to mislead the consumer and exploited their lack of knowledge as to the comparative speed and availability of TelstraClear's services.

Ernie Newman, head of the Telecommunications Users Association, said the ASA and the Commerce Commission had clamped down over the past couple of years on exaggerations in telecommunications advertising, but broadband services were still a confusing product for consumers.

"When it comes to internet speeds the industry is unique because I can't think of another product where you advertise a service as `up to'. With broadband, the certification of speeds is always up to so many megs [megabytes]. That's the speed you will get if no one else is on the line and everything is working perfectly. With most products it's the other way around – they advertise the minimum you are going to get.

"With broadband it's a bit like going into a pub and being told that you can have a handle of beer that contains up to 350ml, but by the way all the people around you have a straw and they're drinking from the same glass."

WHO OFFERS THE BEST BROADBAND?

In a recent survey, Consumer New Zealand quizzed more than 10,000 internet users about their experiences with internet service providers.

Actrix, which offers monthly plans ranging from $40 to $80, came out tops in customer satisfaction, followed by Inspire ($33 to $90 a month).

TelstraClear came in at number 10. Its plans range from $39 to $80.

Telecom came in last, with plans ranging from $39 to $100.

In a separate survey, Consumer found TelstraClear had a higher than average number of complaints about slow download speeds while Telecom had fewer than the average.

Internet users can test their connection speed at www.consumerspeedtest.org.nz and Consumer's website, www.consumer.org.nz, also offers a comparison of internet plans.

lois.cairns@star-times.co.nz