AT&T sues Verizon over TV ads

The nation's two largest wireless carriers already battle fiercely on smartphone devices and customers, but today AT&T took matters to federal court claiming Verizon Wireless' latest TV ads are misleading, and falsely indicate that AT&T has gaps in wireless coverage.

The lawsuit, filed in U.S. District Court for the Northern District of Georgia today, says that Verizon's ads , which began in early October, suggest that coverage areas outside of fast AT&T 3G service, shown in maps in the ads in white, provide no service at all. In fact, most of those white areas are covered, but with somewhat slower wireless speeds, AT&T said.

AT&T is seeking an emergency injunction to stop the ads. It also seeks unspecified damages, accusing Verizon of false advertising, and claims the ads harm AT&T's ability to compete. AT&T also said Verizon's ads are causing AT&T to lose "incalculable market share" and goodwill with customers.

The maps in the ads show 3G service in blue colors for both carriers, with Verizon covering more of the U.S. map. But AT&T has focused on the white areas for the lawsuit.

"Through the use of a coverage map in [Verizon] ads, they suggest through all white or blank space, not only that AT&T doesn't offer 3G coverage but no coverage at all," spokesman Mark Siegel said in an interview. "That's misleading and that's why we filed the lawsuit."

In response, Verizon Wireless spokeswoman Brenda Raney said: "We feel the maps are accurate ... we make sure they are accurate." She said the TV ads clearly indicate in text that appears on the screen that the white areas are places where there is no 3G coverage, and not that there is no coverage at all.

"AT&T is focusing on the white area in the complaint, not the blue, but blue is what they advertise as their 3G coverage," she said. "The white areas are where there is no 3G coverage."

In general, the ads "serve to inform customers where coverage is available that's critical to smartphones," Raney said. "That's important. Their 3G coverage is limited."

While it might sound like a tussle over the blue and the white, Siegel said AT&T has conducted research with customers and discovered that "a significant number of people have seen the ads and said AT&T has no coverage" in the white areas.

Siegel said using white space in coverage maps from all the carriers, including T-Mobile USA and Sprint Nextel, always means "no coverage ... that's the heart of the issue and why the ads are misleading and why we're taking action."

The lawsuit, which runs 32 pages, states that AT&T asked Verizon to "stop running these false advertisements" and Verizon made minor changes to the maps "but continued with its plan to deceive consumers into believing that AT&T customers cannot communicate in areas where they have no 3G coverage."

Generally, AT&T believes Verizon started the TV campaign as a response to AT&T's leadership with smartphone sales, including its exclusive offer of the iPhone in the U.S., Siegel said.

The ad is notable for taking iPhone's "there's an app for that" slogan and changing it to "there's a map for that" to draw attention to Verizon's claim of a superior network coverage map.

"This is a major campaign for them and we believe it's in response to our smartphone leadership, for BlackBerry, iPhone and a whole host of others," Siegel said.

Copyright © 2009 IDG Communications, Inc.

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