Britain and Australia provide example for internet ads, PIAC says

Canada should look to Britain and Australia for lessons on how to regulate internet advertising, a new study by the Public Interest Advocacy Centre maintains. The consumer group surveyed regulators, industry and stakeholder groups as well as looking at foreign markets when assessing the state of the advertising market in this country. The study, Selling Speed: Reforming Broadband Advertising Regulations in Canada, is a 73-page report on the landscape here and abroad. “Where ISPs in the UK and Australia provide for guaranteed minimum average speeds and ranges based on measured peak period speeds, major Canadian ISPs still primarily advertise their services as ‘up to’ a certain speed, or a range that is not openly substantiated by any measurement method,” report author and PIAC staff lawyer Yuka Sai wrote. Unlike those jurisdictions, there are no Canadian laws or codes that require ISPs to abide by certain standards. Consumers get the bare minimum of information to make educated decisions, PIAC wrote. The July report was an update of a similar study conducted in 2012. A major case in the earlier report was a suit involving the Competition Bureau and Rogers Communications Inc. subsidiary Chatr over misleading advertising. The wireless carrier had been claiming its customers experienced fewer dropped calls than those of its competitors. The claim was found to be false and Rogers was fined $500,000, less than the Bureau was seeking. The CRTC told PIAC that internet advertising does not fall under its mandate. It urges consumers who are unhappy with their service to switch providers, a recommendation that does not take into account the lack of competition in some parts of the country, PIAC countered. The regulator does have policies involving internet traffic management practices (ITMPs), which cover such techniques as traffic shaping or deep packet inspection to manage network congestion. The commission requires ISPs to explain why ITMPs are being introduced; who is affected by them; when the internet traffic management will occur; what type of traffic is subject to management; and how the ITMP will affect a user’s experience, including the impact on speeds. The CRTC received 10 complaints about ITMPs in 2021. The CRTC commissioned studies about broadband measurement in 2016 and 2020. PIAC said the latter report is less helpful because of the criteria used to collect data. Only fixed wireless technologies were tested in 2020 and only companies with at least 25,000 subscribers were assessed, limiting the information available from rural and remote areas. “In PIAC’s view, the 2020 Measuring Broadband Canada report is especially less rigorous and therefore less useful than the 2016 study,” the report concludes. The Commissioner for Complaints for Telecommunications Services (CCTS) also told PIAC that advertising and broadband measurement are beyond its jurisdiction. It tends to refer dissatisfied customers to the Competition Bureau or the Advertising Standards Council. CCTS does investigate when a consumer has been promised a certain speed and receives a speed connected to a lower-priced plan. The Commissioner told PIAC it has received a steadily increasing number of complaints about misleading advertising. There were 24 complaints in 2014-15; 66 in 2015-16; 71 in 2016-17; 66 in 2017-18; 116 in 2018-19; 128 in 2019-20; and 153 complaints in 2020-21. PIAC reached out to the Advertising Standards Council for consultation but the group declined to participate. Looking internationally, the group turned its focus to the United Kingdom, where the Advertising Standards Authority (ASA) is responsible for monitoring broadband ads. In addition to a self-regulatory code, there are laws which prohibit misleading or deceptive messages, leaving out information or aggressive sales practices. “While these general rules apply to broadband advertising, the ASA saw fit to impose specific rules in 2018 about advertising residential services,” the PIAC study said. “The basis of these specific rules was that according to the Committees of Advertising Practice ‘speed claims should be based on the actual experience of users and therefore marketers should be able to demonstrate that the speeds in their advertising can be achieved by a reasonable proportion of the provider’s customers.’” In Australia, the Australian Consumer Law, administered by the Australian Competition and Consumer Commission, features provisions on broadband advertising that have been in place since 2017. There are six principles governing the regulations, including accuracy of information, accurate speed data, disclosure of mitigating factors and ISPs having systems in place to resolve speed issues. In the United States, the Federal Communications Commission has proposed new rules requiring ISPs to present easy to understand labels so consumers may compare different broadband packages. Last year President Joe Biden published an executive order directing the FCC chair to consider a broadband consumer label, which would give customers clear information on their data packages. PIAC tried to get reaction from ISPs in Canada for its report but only Rogers, Telus Corp. and Distributel Communications Ltd. responded. Rogers and Distributel said they would be amenable to regulation as long as standards were uniform and certain caveats were implemented. Telus said that improvements to its network are the reason it switched from advertising actual speeds in 2012 to “up to” speeds currently. Civic groups ACORN and the National Pensioners Federation were supportive of new regulations for the Canadian industry. The NPF said seniors are likely to be less technologically savvy and more likely to fall prey to misleading advertising. “In the last decade, the considerable breadth of foreign reforms followed by new pro-consumer policies of foreign ISPs, particularly in Australia and the UK, starkly contrasts with Canada’s own stagnant state of broadband advertising,” the report concluded. “Furthermore, Canadian regulatory bodies have provided limited guidance on broadband advertising, indicating that there is an enduring need for more specific regulations.” The study also found hope in a bill introduced in the House of Commons in 2021 by Conservative MP Dan Mazier mandating transparent and accurate broadband service information. The bill died on the order paper when last fall’s election was called but Mazier has since re-introduced the legislation in the current Parliamentary session. –Reporting by Paul Park at ppark@thewirereport.ca and editing by Michael Lee-Murphy at mleemurphy@thewirereport.ca

Britain and Australia provide example for internet ads, PIAC says

News | August 17, 2022

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