ComCom welcomes new marketing codes for the telecom industry

The Commerce Commission is welcoming the creation of new marketing codes for the telecommunications industry, which they say will help consumers make more informed choices about the best broadband service for them.

The new codes were developed by the New Zealand Telecommunications Forum (TCF) in response to guidelines issued by the Commission that utilise new powers to improve retail service quality for consumers.

In August last year, the Commission wrote to the industry in response to widespread concerns around the marketing of broadband services and confusion around service specifics.

They say some consumers were being led to believe that their copper service was about to be withdrawn when it actually wasn't. Others were being told they had to switch to a particular service when there were various other options available on the market.

All services were also being sold up to or theoretical maximum speeds that many consumers would not have been able to achieve.

In response, the Commission then issued guidelines in November last year to improve broadband marketing conduct and protect consumers before the notably busy Christmas season.

They expected broadband providers to immediately apply the guidelines to their marketing practices at this time, and further to this, also directed the industry to convert the guidelines into a binding industry code through the TCF.

This resulted in the creation of two binding industry codes, which formally commence on 7 May and 30 July 2022. The codes also formalise changes already made by broadband providers while creating an additional industry monitoring and enforcement mechanism.

The codes are the Broadband marketing code and Copper and PSTN transition code.

According to the TCF website, the Broadband marketing code 'requires providers who market broadband services to ensure that the information about the technical and performance characteristics of the broadband service is presented in a clear, accurate and up-to-date way'.

The Copper and PSTN transition code sets out a list of 'requirements that RSPs must meet when their customers are transitioning away from copper-based services due to copper withdrawal, PSTN switch off or a commercial decision means copper services will no longer be available in that area.'

"We've been encouraged by the positive response from the industry to the challenge of cleaning-up broadband marketing," says Telecommunications Commissioner Tristan Gilbertson.

"Providers have changed their marketing practices and the codes that have been issued should lock in the improvements that have been made for consumers."

Gilbertson says consumers will benefit in various ways, such as less pressure when making decisions and easier access to good information and services. There will also be the right to walk away from a broadband plan or provider, without penalty, when a service materially fails to deliver what was advertised.

"We want to make sure the changes providers have made are embedded in their marketing practices. We expect providers to keep us informed on how they are implementing the codes, as well as on how they are making their customers aware of their rights under the codes," Gilbertson says.