The Commerce Commission sent out warning letters to MyRepublic, 2degrees, Spark, and Vodafone and this follows on from the Commission’s recent announcement that the retail telecommunications sector will be an organisation-wide priority for the 2017/2018 year as consumers continue to be confused.
“The complexity and range of goods and services offered by the industry means consumers can be easily confused about product offerings,” comments Commissioner Anna Rawlings.
“As we noted when announcing our 2017/18 priorities, the telco sector continues to generate a high volume of consumer complaints, despite previous compliance and enforcement work by the Commission.”
"Almost every New Zealander uses a mobile or fixed-line phone and broadband, so the telecommunications sector has the potential to have a significant impact on consumers."
The Commerce Commission will continue to investigate issues within the telecommunications and broadband internet sector, including incorrect billing, failures to identify the subscription nature of mobile add-ons, incorrect calculation of broadband usage, unfair contract terms and representations concerning the nature and availability of internet services – the last one being of particular interest to Broadband Compare.
According to the Commerce Commission, the companies that were sent the recent warning letters are likely to have breached the Fair Trading Act due to the following issues:
• Making misleading representations about the price of its unlimited broadband plan by not identifying or inadequately disclosing the additional cost of a modem and its delivery
• Promoting a 1 Gigabit per second service up to 2 months before it was actually available
• Representing that customers on its GAMER broadband service would not experience lag or latency when they could experience lag or latency caused by third party servers
• Incorrect representations that consumers’ rights of cancellation under the uninvited direct sales provisions of the Fair Trading Act ceased to apply once MyRepublic had commenced the service
• Making representations that Vodafone’s 2G network was imminently closing, in the marketing of Spark’s Skinny Mobile service
• Making misleading representations in the promotion of 12-month broadband plans bundled with “free” goods or services when, in order to receive the “free” goods or services, the consumer was required to pay additional fees or to take additional services
• On some occasions, a monthly headline price was advertised, but that price did not include the additional fees to be paid in order to receive “free” goods or services
These are definitely not the first infractions recorded and acted on by the Commerce Commission. Telecoms and internet providers have a bit of history and it reiterates the importance of what we’re doing here at Broadband Compare where we try our best to help you compare ‘apples with apples’... it is a confusing world out there so be sure to get independent advice before you commit. The four companies getting a slapped wrist around these plans are all good companies with good services, just make sure you understand exactly what you’re buying into.
In recent years, the Commerce Commission has taken action against a number of telecommunication companies, including in September 2016 when Trustpower was fined $390,000 for misleading consumers over the price and terms of its bundled electricity and unlimited data broadband offer. Also in September 2016, there was an earlier issue for Vodafone which was fined $165,000 for false price representations on invoices for its ‘Red Essentials’ mobile plan and earlier than that Vodafone reached a $268,000 settlement with the Commission in January 2014, over the promotion of its ‘Broadband Lite’ service.
So be sure to check, compare and contrast before you commit. Any questions? Just get in touch with a member of the Broadband Compare team and we will help you make the best decision to find the best broadband plan for your needs.
