The competition watchdog says a lack of transparency around national broadband speeds is hurting the industry and has placed retailers on notice that they may be penalised for misleading claims.
Australian Competition and Consumer Commission chairman Rod Sims has welcomed the entry of new mobile and fixed broadband competitors but says service providers are not being honest about broadband speeds.
"Right now, consumers are not getting the basic information they need to make an informed choice. Indeed, they are often being misled," Mr Sims said in Sydney on Thursday.
With many households reporting slower internet speeds after buying access to the taxpayer-funded $49 billion NBN, Mr Sims said broadband was an enforcement priority and expects cases before court this year.
"We are investigating and expect to be taking action in respect of misleading conduct around broadband speeds," he said.
The competition regulator plans to call out retailers that have sold or are selling broadband services at speeds they cannot deliver.
Addressing the Unwired Revolution Conference, Mr Sims suggested providers would soon be lifting their game when broadband speeds are made public under the regulator's new Broadband Monitoring Scheme.
The regulator launched a call for volunteers to join the scheme's testing panel last month and will begin publishing speed and performance data later this year.
"We will highlight - and customers will notice - whether companies are advertising in a transparent or a misleading way," Mr Sims said.
The ACCC is also examining the opaque relationships between the NBN Co and retail providers that can leave consumers without redress when the service is not up to scratch.
Mr Sims said it was unusual that currently, the ACCC regulates NBN Co's prices, but not its service standard.
"If consumers are not obtaining redress for NBN Co-caused faults, either because of exclusions in retail contracts, or because of issues in the retailer recovering compensation from NBN Co under the wholesale broadband agreement, that would be of considerable concern to the ACCC," Mr Sims said.
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