November 7, 2017 / 11:43 PM / in a year

UPDATE 1-Telstra to compensate 42,000 customers as national broadband network disappoints

* Company can’t deliver promised internet speeds in some cases

* Offers refunds to some customers on National Broadband Network

* Follows 160 pct jump in network customer complaints (Adds background, details on remediation plans and shares)

Nov 8 (Reuters) - Australia’s biggest telecom company, Telstra Corp Ltd offered refunds on Wednesday to about 42,000 customers after it failed to provide promised fast download speeds on the nation’s new A$47 billion ($36 billion) broadband network.

The payments, which follow pressure from Australia’s competition watchdog, are the latest move to placate a growing number of internet users disappointed by the government-built network.

“In essence, people were paying more to get higher speeds that they just weren’t able to get,” Rod Sims, the Australian Competition and Consumer Commission (ACCC) said in a statement.

“However, we are mindful this is not just a Telstra problem; it is an industry problem where consumers are often not getting the speeds they are paying for.”

Telstra blamed the issues on the “underlying technology being rolled out” across the country, as the optic-fibre system replaces copper-wire.

The company said it had been reviewing network speeds since May. Less than 5 percent of customers were sold services where it has been unable to provide promised speeds, Telstra said, and these customers have been offered refunds.

“We also give these customers the option to move to a different speed tier, or to cancel their contract altogether,” Vicky Brady, Telstra Group Executive for Consumer and Small Business, said in a statement.

The ACCC announced last week that it would investigate service standards on the broadband network, after government figures showed complaints from customers on the network jumped nearly 160 percent this year.

Telstra shares edged 0.3 percent lower, in line with the broader market in early trade on Wednesday. ($1 = 1.3072 Australian dollars) (Reporting by Rushil Dutta in Bengaluru and Tom Westbrook in Sydney; Editing by Richard Pullin)

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