ISPs to be named and shamed: ACCC to monitor NBN speeds

The federal government will fund a broadband performance monitoring scheme run by the Australian Competition and Consumer Commission, communications minister Senator Mitch Fifield announced today.

Some 4000 volunteer households will have hardware installed to monitor the performance of their fixed-lined National Broadband Network services.

This year’s budget will earmark $7 million over four years for the new Broadband Performance Monitoring and Reporting (BPMR) program.

The ACCC’s proposal to the federal government was based on a three-month pilot the organisation ran in Melbourne in 2015.

End user performance on NBN connections depends on a variety of factors. The type of fixed-line access technology — fibre to the node (FTTN) or fibre to the premises (FTTP), for example — can affect the maximum potential speed of a household’s connection, but so too can factors such as the distance of a building from a node if FTTN is employed.

One key speed constraint can be the capacity provisioned by a retail service provider (RSP — the term for ISPs that sell services to end users over the NBN) at NBN’s Points of Interconnect (POIs). RSPs pay for capacity through a charge known as the Connectivity Virtual Circuit (CVC).

NBN has previously indicated it believed some speed complaints by consumers related to under-provisioning by RSPs. Telcos have criticised the CVC for the hit it can have on their margins. NBN earlier this year announced a new discount scheme for CVC, which cuts CVC prices for RSPs if they provision more capacity per end user.

NBN has also expressed concern that some consumers are not aware that different speed tiers are available on its network.

The BPMR program will “allow the ACCC to determine if issues are being caused by the performance of the NBN, or by internet service providers (ISPs) not buying sufficient capacity,” ACCC chairperson Rod Sims said in a statement.

“It will also provide ISPs with independent performance information from which to draw when making speed claims.”

“This program will see the ACCC test and report on the typical speed and performance of broadband plans provided over the NBN,” Sims said.

“This information will assist consumers in comparing and shopping around, and checking that they receive what they are paying for,”

“We would look to construct the volunteers into reporting classes such that we could then generate reports that could then show performance by different access technology, by different RSP, different geographic regions,” Sean Riordan, ACCC general manager, industry structure and compliance, last month told parliament’s NBN committee.

“The data, provided that we’re successful in recruiting that spread of volunteers, would give insights into a range of different policy issues plus giving an insight into how RSPs perform comparatively and could also give a good sign-posting as to where issues may be systemic to the access component and more specific to an individual RSP,” he told the hearing.

The ACCC said the program is set to begin next month and it hopes to provide comparative information on RSPs’ performance in the second half of this year.

Although most participants will have NBN connections, the ACCC said a number of households will be connected to “NBN-like” networks and “legacy networks”

The telco industry has previously expressed a lack of enthusiasm for the ACCC’s proposal.

“Although the ACCC has told industry today that it doesn’t yet know how many service providers will be included in the regime, it has previously indicated that it expects this will be limited to something like the five largest players,” Communications Alliance CEO John Stanton said in a statement issued today.

“Smaller ISPs are worried that being out of the limelight of the published results will cost them customers and damage their businesses,

“The regulator, which exists to promote competition, needs to ensure that it does not engineer the opposite outcome.”

The ACCC recently released guidelines for RSPs on making speed claims. The guidelines state that RSPs should provide consumers with accurate information about typical busy period speeds that the average end user on a particular broadband plan can expect to receive, rather than theoretical speeds based on the specifications of a particular technology.

Labor said it backed the new ACCC program.

“The real question is why has this sensible step taken so long?” acting shadow communications minister Mark Dreyfus said in a statement. “Quite simply, this government does not care about consumers. They never have, and they never will.”

Dreyfus said that the decision to employ copper-based technologies such as FTTN for the NBN was helping drive up complaints from end users on the network.