Up to 50,000 Telstra customers may be eligible for a refund on NBN plans

Anula Wiwatowska - Offsite Editorial Lead

Last updated 08 July 2021

According to an investigation by the Australian Communications and Media Authority (ACMA), Telstra has been found to be charging almost 50,000 customers for an NBN speed tier that they are unable to attain.

Not all NBN infrastructure is capable of achieving every speed tier, most notably Fibre to the Node, Fibre to the Basement, and Fibre to the Curb technologies can be unable to reach maximum speeds on NBN 100 plans.

Under ACMA rules, NBN providers are required to verify the maximum internet speeds for each connection and contact customers if the advertised speeds cannot be met. Where this is the case, customers are entitled to change to a slower speed tier or to terminate the contract without penalty.

Between September 2018 and October 2020, Telstra was found to have failed to notify up to 49,092 customers of these underperforming connections. Telstra will be required to pay upward of $25 million in refunds to affected customers, and must complete an independent audit of the systems it has in place to notify customers of underperforming connections.

This isn’t the first time Telstra has been caught out, in 2019 the provider compensated approximately 42,000 customers for the same issue.

The past two years, Telstra has periodically stopped offering NBN 100 plans to FTTN, FTTC, and FTTB customers because these speeds can’t be guaranteed on these technology types. While these customers can now get an NBN 100 plan with the provider, up until a couple of days ago FTTN and FTTB tech types were still unable to get speeds faster than 50Mbps from Telstra. These restrictions are now lifted, but customers do get a warning that these technology types may not achieve the maximum speeds.

Why Telstra has decided to limit FTTB connections is unclear. Most FTTB connections use a shorter length of copper making speeds more reliable on the whole.

The main issue is that a provider can’t test the physical connection until a plan has been purchased, so there is no way to determine if a property will be able to get maximum speeds until a commitment has already been made. The blanket-ban approach suggests that Telstra doesn’t want to risk failing more customers.

Big-T isn’t alone in it’s limitations - Dodo only offers NBN 100 plans to FTTP, FTTC and HFC connections, and Belong’s fastest speed tier capped at 80Mbps isn’t available to FTTN or FTTB households.

FTTN connections may be stuck on a slower connection for now, but respite is coming in the form of an NBN upgrade program. NBN co. has committed to a $3.5 billion program that will see up to 75% of Australians able to achieve gigabit NBN by 2023.

FTTN households will benefit the most, with up to two million connections eligible to be upgraded from FTTN to FTTP for free. A full list of the first eligible suburbs is available here, with these upgrades estimated to be available from late 2021.

Anula Wiwatowska

Offsite Editorial Lead | Instagram

Anula is the Off-Site Editorial Lead for WhistleOut Australia, and an award winning tech journalist. She has been writing about the Australian telco industry, and consumer technology for over five years, and has been known to tell her Uber driver which phone they should upgrade to next.

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