NZ Broadband

New "rules" proposed for the marketing and selling of broadband

By
Chorus
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August 23, 2021

If you’ve found the whole broadband purchasing decision a bit confusing at times we hear you!

Between bits and bytes and knowing the difference between your fibre and your wireless, it’s not easy to know what to look for in the quest for a quality broadband connection.

Complicating matters at the moment too is changes to the network infrastructure that broadband services use to get the internet to your home or office.

What’s happening is that parts of the legacy copper telco network that Chorus owns, as well as the old landline phone service (PSTN) that sits on the copper network and is owned by the retail service provider Spark, are being phased out.

Both processes are happening separately with the copper network withdrawal happening at a small scale initially and limited to places where more modern alternatives like fibre broadband, are available. There’s also a set process Chorus must follow with consumer protections in place to ensures plenty of notice is given. The phasing out of the PSTN service doesn’t have these same controls.

While the modernisation of our broadband networks is a good thing for a more digital hungry nation like ours, it appears these once in a lifetime network changes are being used by some retail service providers (RSPs) as an opportunity for more assertive industry sales and marketing tactics.

According to the Commerce Commission it’s led to more confusion with unclear and at times, misleading communications about the processes:

“We have examples of people being told they need to move now because Chorus and Spark are in the process of withdrawing their copper and PSTN service when withdrawal isn’t even scheduled yet, and marketing materials are making claims about the performance of alternative (broadband) technologies that don’t reflect real world performance,” – Tristan Gilbertson, Telecommunications Commissioner.

The good news is help is on hand.

The Commission stepped in earlier this month and came up with some proposed principles for the way RSPs market and sell broadband “to ensure consumers receive the information they need about alternative (broadband) technology options as they transition off” their existing services.

There are 29 conduct principles in total, and while it may seem a bit daunting to digest them all, it’s worth having a basic idea as they do act as “rules” RSPs must abide to when selling broadband.

And if you’re across them even at a high level, it will help enable any discussions you have with RSPs as part of broadband services purchase.

Here’s a few key ones to consider:

  • RSPs should not give copper withdrawal (or PSTN shutdown) as a reason for moving unless they can point to a formal notification from Chorus (or Spark) relating to that consumer’s premises.
  • RSPs should remind consumers that they are likely to have the choice of several competing options depending on their location – including different technologies, services and service providers.
  • RSPs should use likely actual peak time download speeds when advertising alternative telecommunications services so that consumers understand what they can expect before making their purchasing decision.
  • Likely actual speed indications should be objectively justifiable, and independently verifiable, such as by reference to the Measuring Broadband New Zealand programme.
  • RSPs should ensure consumers are given upfront information about the factors known to affect the service performance of alternative telecommunications services

There’s still a fair bit of water to flow under this regulatory bridge but for now, the Commission consultation closes this Friday 27 August.  If you’d like to give feedback on the principles and / or whether guidelines, or a voluntary or regulated Code is the appropriate approach please tell them what you think

Ultimately, we think it is vital that all consumers have accurate information so that they can make informed choices for their household needs. 

For now though, you can choose to school yourself up on broadband choices, rather than waiting for any regulatory intervention as there’s plenty of information available via the Chorus website and Broadband Compare to prepare yourself for any switch of services.

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