Dodo has agreed to refund $360,000 to about 16,000 customers who incurred excess data charges after signing up for NBN plans advertised as “perfect for streaming”.
Dodo, Vocus Group’s challenger internet brand, has admitted the claims were “likely to be false or misleading and in contravention of the Australian Consumer Law”, the Australian Competition and Consumer Commission said on Wednesday.
Dodo advertised its NBN broadband plans as “perfect for streaming” even though some plans had a maximum speed of 12 megabits per second and others included just 10 gigabytes of monthly 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,” ACCC chairman Rod Sims said.
“At 12Mbps, Dodo’s customers could not stream ultra HD video at all.”
Also, customers on plans with just 10 gigabytes of data a month would eat through that just watching two or three movies, the ACCC said.
“”We don’t believe NBN plans with just 10GB of included data are ‘perfect for streaming’,” Mr Sims said.
“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.”
Dodo advertised the internet plans from November 2015 to March 2018.
Vocus said fewer than three per cent of customers were hit by the excess usage charges and they averaged $23 a customer.
“Doing the right thing by our customers is our focus and we apologise for our error,” Dodo chief executive for business and consumer Antony de Jong said in a statement.
He said Dodo would contact affected customers as soon as possible and those who wanted to leave their plans could do so at no charge.
“Further, we ceased new sales of that specific NBN plan and promotion some time ago, turning our focus to offers that deliver a better experience.”
Dodo’s cheapest plan advertised on its website on Wednesday includes 101 gigabytes a month, and the provider claims that plan averages 20.4Mps of evening internet speed.