Julian Peterson

Broadband speeds - time for some transparency and proper competition

What speed do you get from your ISP? Do you know anyone in Australia who achieves 24 Mbs - the theoretical speed of ADSL 2+ or are you and everyone you know "too far from the exchange" ? There'll only be true competition between ISPs when there is clarity on actual speeds - ISPs should be only be allowed to advertise the speed that you will achieve in your area.

In January 2007 the ACCC issued an Information Paper to ISPs to help them comply with the Trade Practices Act 1974 because, said the ACCC:

"The Information Paper is a proactive step by the ACCC to help ISPs comply with their obligations under the Act when advertising their broadband services and prevent consumers being misled as to the speeds achievable on various technologies."

"The paper draws attention to the industry practice of using hypothetical speeds as the basis of speed claims when these speeds are unlikely to be achieved in the real world."

"The ACCC is concerned that ISPs are using 'hypothetical' speeds when these speeds are just that – available to the hypothetical consumer not necessarily the real world consumer. At the ACCC, we are concerned about the real-world consumer."

"The paper focuses on ADSL2+ because consumers may be attracted to these services by speed claims. As a new technology, consumers usually have less information than the provider of the service and may be misled by headline claims of hypothetical maximum speeds."

See the paper here:

This paper could just as well have been issued yesterday and not 4 years ago – it seems that nothing has changed.

Looking today (June 2011) on iSelect I can chose between the following:

                Provider               Cost                                       Speed quoted

                iiNet                      $59.95 per month               Speed "Up to 24Mbs"

                YesOptus             $49.99 per  month              "Super fast"

                BigPond               $69.96                                   "Supersonic"

On other websites such as YouCompare I find the speed of ADSL2+ quoted as "ADSL2+"

I can chose the price, contract length and data limit but why is there no clarity on what is arguably the most important factor – the speed?

I recently found my ADSL2+ speed in Woolloomooloo was around 1Mbs and complained to the provider – great service response and we talked through all settings.  No change so we changed the wire between the router and the socket. Then we changed the router. ($159)

After all this I was told again that we must be "too far from the exchange" – I can see Westpac, RBS, Deutsche Bank and Sydney CBD about 500m away so I sent an email asking, specifically, "Where is the exchange exactly?". No address was given in the reply but I was told an engineer would be coming over within 2 days – interesting response. Engineer's visit to flat and then to exchange revealed nothing actually wrong but our speed rose to 5Mbs.

So now we had one fifth of the advertised speed but I really wanted to know where the exchange was so I rang again – the service desk "didn't have the exact address" but would send a different type of engineer the next day. This time engineer said the line was very noisy and he wasn't surprised that we had problems and would report the problem to the telco who look after the line.

A week later we're still just under 5Mbs.

Then I suggested to the provider that we divide their monthly fee by 5 and I pay that instead and was finally rewarded by the address of the exchange: 330 Liverpool St, Darlinghurst 2010 which is a 3km+cable run from Cowper Wharf Road, Woolloomooloo. It might be.

But does anyone who lives in Liverpool St, Darlinghurst get 24Mbs? Please do leave a comment below.

And is it really honest for the ISPs to be selling people in Woolloomooloo (and I would expect, Potts Point and other areas) an "up to 24Mbs" connection when they know they won't get more than 1/5 of that?

Time for some transparency whether it's voluntary or through legislation – consumers are being taken for a [slow] ride.


Further reading:

It is an international problem:
Average broadband speeds 'less than half those advertised', says Ofcom (UK)


Ofcom calls for clarity in broadband speed as difference between advertised and actual speed widens:


Posted by Dennis, 1 July 2011

hey julian,

i read your article with interest. a year ago i had big pond cable broadband connected. i was trying to use wireless but it was too slow and capped. i trade on-line so i was keen for bandwidth and speed.

the ISP promised 100mbs. the best i got on wireless was 7mbs so i did some calcs and played back the conversation to the sales guy. so if i understand you correctly, you are telling me i can get download speeds 14 X what i am currently getting.

i don't get anything over 20mbs. the matter remains unresolved.

i am considering a move to brunswick to experience the NBN pilot site. 100mbs could make a world of difference to an on-line sports trader.

Posted by Julian , 4 July 2011

Thanks Dennis,

I'm still yet to hear from anyone who gets anything like the "up to" speed advertised by there ISP.

I really think this should be dealt with now - there'll be massive disappointment and political fallout with the NBN if people are told "up to 100Mbs" and only get, say, 20Mbs.

Posted by Julian Peterson, 5 July 2011

The ACCC has again threatened litigation against ISP's whose real speed does not match what they claim:


"In an information paper released late last week, the competition watchdog warned ISPs against misleading customers through false advertising of internet speeds."

The ACCC has already taken action against one ISP:


"... customers that felt they were misled into signing up to the ISP's 'think bigger' and 'supersonic' broadband plans could exit their contracts without penalty..."

Posted by Anoop, 28 July 2011

Great article Julian,

I've always found a great disconnect between what ISP's advertise / publish and what people actually get once signing up.

The old "distance from the exchange" line is well over used and there needs to be some transparency around this issue. I've actually thought that people would be prepared to pay more if they could get certain guaranteed speeds, and an ISP that was bold enough to stand behind their deliverable service might change the game and be a successful wake up call to other ISPs.

Unfortunately, this still hasn't happened and probably never will. There's also the fact that Telecom (old telstra) originally ran cables everywhere and not in the most efficient manner!

Posted by Julian Peterson, 28 July 2011

Good point Anoop.

10,000 miles away, exactly the same argument is happening with ISPs in the UK, this from the BBC yesterday:

ISPs 'still mislead' on broadband

"Average" broadband speeds vary due to a variety of factors
Continue reading the main story
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ISPs under fire over broadband claims
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Broadband speeds in the UK now average 6.8Mbps (megabits per second) but there is still a huge gap between advertised and actual speeds, according to Ofcom.

Almost half of broadband users are now on packages with advertised speeds above 10Mbps but few achieve this.

Ofcom's biannual report into the state of the broadband market urged changes to advertising.

Virgin Media, which fared well in the study, accused its rivals of misleading the public.

The report found that the average broadband speed had increased by 10% in the past six months, mainly because people were trying out faster services.

But the gap between advertised and actual speed had widened in the same period. The average advertised speed was 15Mbps, 8.2Mbps faster than the average actual speed.

It also found that more than a third of customers on services advertised as "up to" 24Mbps actually received speeds of 4Mbps or less.

"The research is still telling us that some consumers are not receiving anywhere near the speeds that are being advertised by some ISPs," said Ofcom chief executive Ed Richards.

The watchdog is urging changes in advertising guidance "so that consumers are able to make more informed decisions based on the adverts they see".

BT, whose 20Mbps service typically managed between 7.3 and 8.9Mbps, said that it was "confused" by Ofcom's reference to the speed gap.

"We give bespoke speed estimates to all customers at the point of sale and this is now underwritten by the [Ofcom] code of practice," the company said in a statement.

"No customer should be in any doubt as to the likely speed that they should expect from our service."

Superfast broadband - anything above 24Mbps - was now available to 57% of UK homes, the report found.

But three-quarters of broadband services are still delivered via copper-based ADSL technologies, which will always have speed limitations based on the distance between the home and the telephone exchange.

Continue reading the main story

BT's "up to" 20Mbps - average 7.3 - 9.1Mbps
Plusnet's "up to" 20Mbps - average 6.6 - 8.4Mbps
Sky's "up to" 20Mbps - 7.2 - 8.1Mbps
TalkTalk's "up to" 24Mbps - 7 - 8.5Mbps
Virgin Media's "up to" 20Mbps - 16.4 - 18.1Mbps
Orange's "up to" 20Mbps - 6.6 - 7.6Mbps
02/Be's "up to" 24Mbps - 10 - 11.5Mbps
Speeds measured between 8-10pm weekdays. Source: Ofcom
Other factors that slow down a connection include the quality of the wiring in a house and the time of day that the service is used.

Fibre advantage
Virgin Media is the only ISP able to come close to advertised speeds because cable services are not influenced by distance.

It has spearheaded the campaign to change the way broadband is advertised.

Jon James, executive director of broadband for Virgin Media, said: "The gulf between what's advertised and what speeds customers get continues to grow."

"We remain concerned that people paying for fast broadband are still being misled and believe it is absolutely essential that consumers have all the information they need to make an informed choice," he added.

The Advertising Standards Authority (ASA) is currently reviewing broadband advertising. Its report is expected in the next few months.

Last month it ruled that Virgin Media's campaign against false advertising itself broke advertising rules.

Andrew Ferguson, co-founder of broadband news site ThinkBroadband, thinks more needs to be done to explain the differences between cable and ADSL but is not sure changes to advertising is the correct way.

"Adverts will shift to lifestyle advertising rather than actual facts, and some people may be denied access to products because they would drag the average speed down," he said.

Voluntary code
Ofcom has introduced a code of practice to help inform the public about their likely speed before signing up to a service.

It recommends that broadband customers should be given a speed range rather than a single estimate of the maximum speed on their line.

It also suggests that users be allowed to leave their provider without penalty if they receive a maximum speed which is significantly below estimates.

So far, Virgin Media, BT, O2 and Sky have signed up to the voluntary code.

Michael Phillips, of comparison website broadbandchoices, is not sure the code goes far enough.

"Ofcom's code of practice has made some steps in the right direction, but without some more careful thought, there's still room for a lot of confusion.

"How will my mum know if a service offering 1Mb - 6Mb is better or worse than one providing 2Mb - 5Mb? She needs to know what speed she's most likely to receive most of the time," he said.

He thinks that "typical speeds" should be made "the gold standard for speed advertising in the same way that banks use 'typical APR' percentages".


Julian Peterson dianomi Julian Peterson
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Digital, marketing and publishing Oversaw the launch of Time Out Singapore's website in 2007/08, growth in Time Out Sydney's site in 2009/10, Time Out Sydney s iPhone app and launch of Time Out Melbourne s website in 2010 & new Time Out Sydney site in 2011 Read Julian's full bio

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