Internet service provider Dodo has agreed to refund up to $360,000 to around 16,000 customers for claims that its entry-level NBN broadband plans were "perfect for streaming".
The refunds are part of a court-enforceable undertaking made to the ACCC after Dodo admitted its conduct was likely to be false or misleading and in contravention of the Australian Consumer Law.
From November 2015 to March 2018, Dodo advertised its NBN broadband plans as "perfect for streaming", including for plans with maximum speeds of 12 megabits (Mbps). Some of these plans only had 10 gigabytes (GB) of included data.
“We were concerned that Dodo customers on these plans could not reliably stream high quality video, particularly when others in the household were using the internet at the same time. At 12Mbps, Dodo’s customers could not stream ultra HD video at all,” ACCC Chair Rod Sims says.
The ACCC also considered that Dodo customers would use up their data allowance after a modest amount of streaming when their included monthly data is limited to 10GB.
“According to Netflix, high definition streaming uses up to 3GB of data per hour. With these plans a customer would have to pay extra if they streamed just two or three movies,” Sims says.
“We don’t believe NBN plans with just 10GB of included data are ‘perfect for streaming’. Consumers rely on how internet providers describe their services when choosing the best broadband plan for their needs, so these descriptions must be accurate.
“It is simply unacceptable for an internet service provider to tell consumers that their services are ‘perfect’ for a particular use, and to then charge them extra when they use the service as advertised.
“The ACCC will continue to address consumer issues in the provision of broadband services, including misleading use and performance claims made by providers.”
As part of the undertaking provided to the ACCC, Dodo has agreed to provide refunds to around 16,000 current and former Dodo customers on affected plans who incurred excess data charges during the period when the ‘perfect for streaming’ advertisements were published.
Those customers who were subject to excess data charges and are still with Dodo will also be offered the option to exit their contract at no cost.
Last year top Dodo marketer Andrew Wynne spoke to AdNews, admitting some may have seen its past advertising approach as “cheap and nasty”, which is why, after 17 years, the time was finally right to ditch the animated bird and catchy tune.
Wynne overhauled the company's advertising and marketing approach, bringing in PHD as its media agency and Deloitte Digital as its creative partner.
Have something to say on this? Share your views in the comments section below. Or if you have a news story or tip-off, drop us a line at adnews@yaffa.com.au
Sign up to the AdNews newsletter, like us on Facebook or follow us on Twitter for breaking stories and campaigns throughout the day.