Stuff Fibre warned by watchdog over broadband speed claims

Stuff Fibre admitted it didn't know if its broadband services were actually faster than its competitors. Picture / Getty Images

Stuff Fibre has been warned by the Commerce Commission over its unsubstantiated broadband speed claims.

NZ Fibre Communications Limited, which trades as Stuff Fibre, likely breached the Fair Trading Act because it didn't have reasonable grounds for making the claim that it is "Probably NZ's Fastest Internet", the regulator said in a statement.

Stuff Fibre hadn't done any broadband speed comparisons with competitors and admitted it didn't know if its broadband services were actually faster than its competitors.

The commission took the view that the caveat "probably" was not effective to prevent customers from being misled, it said.

"The internet speed claim is a matter of scientific fact that consumers would expect to be known and verified," commissioner Anna Rawlings said.

"If a trader is prepared to say it is "probably the fastest", this will suggest to many consumers that they have done their research and are comfortable they are performing at that level. In fact, Stuff Fibre had not verified its claim."

"Traders need to remember a claim is unsubstantiated if they do not have reasonable grounds to make the claim at the time they make it - irrespective of whether the claim is false or misleading."

Stuff Fibre managing director Sam Morse said it accepted the commission's decision.

The company had intended to highlight that it only sold ultrafast broadband, which it believed was the fastest and most reliable internet technology in New Zealand.

"The commission is very agitated about the telco industry and the telco sector and they are being very diligent, and we comply and we accept their decision," Morse said.

In September, heat pump supplier Fujitsu General New Zealand Limited was the first company convicted under the unsubstantiated representations provision of the Fair Trading Act and was fined $310,000.