Telecom and ComCom settle over incorrect broadband metering

Formal settlement made

The Commerce Commission and Telecom have reached a settlement over the incorrect charging of some broadband customers between November 2010 and June 2011. To date, Telecom has refunded overcharged customers more than $2.7 million. The settlement document can be viewed on the Commission's website. Stuart Wallace, Commerce Commission Competition Manager, says in a statement: “We’re pleased to have reached a settlement with Telecom and that they have made prompt refunds directly back to the customers who have lost out. “Telecom brought this issue to our attention as soon as they were made aware by their customers and have co-operated fully with the Commission. Due to Telecom’s immediate admission of a breach of the Fair Trading Act, followed by appropriate compensation to customers, the settlement is the best possible outcome for those customers and avoids potentially lengthy and costly court hearings paid for by taxpayers." Telecom says the inaccurate readings affected approximately 97,000 customers and were due to a software fault in broadband usage meters. The result of the inaccurate readings was that around 47,000 of the customers were impacted in one or more of the following ways:

  • Customers had the speed of their broadband service reduced (or ‘throttled’) to dial up speed once the reading reached their data cap.
  • Customers upgraded to a more expensive monthly broadband plan to increase their monthly data allowance due to an incorrect perception about their data usage.
  • Customers were charged overage fees for the amount of data that they used above their data cap.
  • Customers reduced their data usage so as to not exceed their monthly data allowance.
  • Customers were charged early termination fees for changing providers as a result of incorrect perceptions about their data usage.

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