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AT&T lawsuit magnifies spotty service

Company claims Verizon's ads are misleading.

Posted by Minyanville on Wednesday, November 4, 2009 12:39 PM
This article is written by Minyanville's Mike Schuster

While AT&T (T) and Apple (AAPL) may compose some attractive ads showcasing the iPhone's slickest features, Verizon (VZ) can make the two companies stand and take notice by touting one superior aspect: coverage.
AT&T is suing Verizon over its recent campaign titled "There's a Map for That" -- a tongue-in-cheek take on the oft-repeated line "There's an app for that" in iPhone commercials.

AT&T is accusing the company of false advertising based on the ad's comparison of 3G coverage in either service. Whereas Verizon's coverage map is a sea of red, AT&T's barely freckles the country. The title underneath states that Verizon offers five times as much 3G coverage throughout the US.
Although it doesn't deny its 3G coverage is severely lacking -- Engadget cites its complaint which says it has "no quarrel with Verizon advertising its larger 3G network" -- AT&T claims the map comparison implies its service provides no coverage whatsoever in the blank, uncolored areas.

The company asserts that its capable -- though inferior -- EDGE network will allow calls to be made in the majority of those areas. As a result, AT&T is filing a motion to have the ads taken off the air.

AT&T had this to say in the lawsuit:

In essence, we believe the ads mislead consumers into believing that AT&T doesn't offer ANY wireless service in the vast majority of the country. In fact, AT&T's wireless network blankets the US, reaching approximately 296 million people. Additionally, our 3G service is available in over 9,600 cities and towns. Verizon's misleading advertising tactics appear to be a response to AT&T's strong leadership in smartphones. We have twice the number of smartphone customers... and we've beaten them two quarters in a row on net post-paid subscribers. We also had lower churn -- a sign that customers are quite happy with the service they receive.

Given how many people have complained (see Economic Snapshot: AT&T Still iPhone's Biggest Flaw, and also here, here, and here) about AT&T's spotty coverage, it probably has more to do with Apple's exclusivity contract with its iPhone.

Even before the lawsuit, Verizon had altered its ads to appease a cranky AT&T. The ads omitted the phrase "out of touch" and added "voice and data services available outside of 3G areas" as a small disclaimer on the bottom of the screen. But even that didn't keep AT&T from talking with its lawyers.

Overall, this appears to be a very needless lawsuit. Verizon covers all the legal bases in the ad and is well within its rights. AT&T's knee-jerk reaction to factual evidence just makes the company look like whiny and overly litigious spoilsports.

No positions in stocks mentioned

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1 - 15 of 377
Saturday, November 07, 2009 12:16:55 AM
Totally agree, get the phone that will help you according to the area that benefits you the most. I have had AT&T for almost 5 years and I have liked it so far. The times that I got a large bill is because I travel to another country and I did not change my plan to international. So, it was my mistake I should have considered before the trip or even when I was already there. Anyone who reads this, change your plan before traveling to another country.
Friday, November 06, 2009 8:50:39 PM
i have been with att/cingular for quite some time now and i never had a problem with their service.Verizon is a great carrier and they need to be in the virgin island.
Friday, November 06, 2009 7:13:58 PM
I have AT&T new customer, I had the phone 3 days and got a $147.00 bill, I was told they prebill new customers, Next bill was almost $300 they where trying to tell me I added a second line 3 days from ordering the new phones and service, I told them everything was ordered the same day and would be more then happy to send them a copy of the order. After 2 hours with them I finally got some money off but not what I should be paying a month, this month i get my bill mind you I have paid the amount each month in full, I go to use the phone no reception and a recording I own them money. The money the customer service rep took off the bill for their mistake. They shut me off with no warning. I called up after over an hour with customer service they tell me ok we fixed it, well that's what the guy last month told me too. Then they where trying to tell me I need to pay a reconnection fee of $35 for a mistake they made. Are you kidding me. I told the women I was ready to send the phones back and see her in court, only then did my fee get waved. I should have stayed with Sprint at least I didn't get nickle and dimed like I have with AT&T. They have great phone crappy customer service and even worse is the billing department. I can't wait to see how they try to screw me next month
Thursday, November 05, 2009 4:20:16 PM

It's pretty clear that the ad is talking about 3G coverage (it even says so on the map, if you look fast enough).  AT&T just doesn't offer the service in as many areas as Verizon.  I don't use either company so I really don't have a horse in the race, but if AT&T spent its considerable money on upping their coverage instead of filing junk lawsuits, they might fare better.  At any rate, I don't see anything deceptive about the ads, unless you're not really paying attention.  Just sayin'

Thursday, November 05, 2009 3:59:31 PM
I have had Version, Sprint etc.  Version was ok, Sprint terrible and TMobile a joke.  We like AT&T the best due to coverage in areas that we go camping.  We have not had any problems since we threw away the IPhone.  They are getting flack from Iphone users for what is actually the IPhone problems.  We purchased a Samsung smart phone which works great and a Motorola that we actually use most of the time.  Get the service that works best for where you are and were you mostly go. 
Thursday, November 05, 2009 3:19:14 PM
who pauses the commercial to pinpoint the map anyway?
Thursday, November 05, 2009 3:17:45 PM
Well AT&T could do two things
1. Build up its coverage so Verizon can't make that claim
                            or
2. Pay Verizon to advertise for them


Thursday, November 05, 2009 2:15:39 PM
the DROID comes out tomorrow! sweet!!!!!!Open-mouthed
Thursday, November 05, 2009 2:04:50 PM

I have Verizon Wireless. I love it. The AT&T lawsuit is completely off base here. It is quite clear what the commercials mean on television. They are specifically talking about 3G coverage, aka data and internet capabilities. If the iPhone was available on Verizon, AT&T would already be out of business. Verizon's network, at least in the northeast where i live, surpasses any other network by far. I do travel up to the mountains in Maine every now and then and don't have service, but would would expect service when you are in the middle of the mountains? I actually like it because i go up there to get away from the world, it actually forces me to do this. And to all those Mac lovers who have iPhones and claim macs are the best and pc's suck. . . Think about it. How many times have people had to bring their phones, iPods or macs into see a Genius at the apple store? Everytime i walk in the line is full and its an hour wait. Screw apple and screw at&t for making an agreement. As soon as the exclusive contract is done with at&t they will fold and be bought by verizon!

Thursday, November 05, 2009 1:43:44 PM
I had T-Mobile (Deutsche Telecom), then AT&T wireless, then Cingular, then AT&T wireless again all without moving my phone but through company merges.  The service from these companies which are the same company all were lacking in coverage areas.  The service did work great if where you were had coverage when you did not forget it.  Funny thing is T-Mobile in Europe has great coverage all over Europe and I never had any problems in Europe always had bars.  They all share the towers with each other so all the cell phones work no matter where you are.  Not that way here in the US.  Each company has it good and bad points but when it comes to coverage Verizon does bet all the other providers out there and there is no question on that extent.  Sure you will find areas where Verizon does not have coverage but here is the kicker you will find less of them with Verizon than if you have the other players like AT&T and Sprint.  Everyone of the cell phone companies have policies that we as consumers do not like or agree with the key here is you signed the contract and no one twisted your arm to sign said contract.  Can there be improvements sure will they happen not unless the public steps in and stops using the cell phones or get the FCC to step in by filing so many complaints that the government has no choice but to step in to put control on the companies.  Remember the one year contract and the $75.00 cancelation charge if you wanted out... now it's two years and $175 but they did pro-rate that because the public made such a fuss that the cell phone providers stepped in before the government could step in.  This was a stop gap measure by the cell phone companies and was not for you it was to keep the FCC and government out of regulation of the industry.  Now Verizon is going to double the cancellation charge though it will still pro-rate that charge out for the months left on the contract.  If the FCC and government does not step in this type of stuff will keep going on.  So rather than complain here take action and write the FCC to get something done!  I had T-Mobile (Deutsche Telecom), then AT&T wireless, then Cingular, then AT&T wireless again all without moving my phone but through company merges.  The service from these companies which are the same company all were lacking in coverage areas.  The service did work great if where you were had coverage when you did not forget it.  Funny thing is T-Mobile in Europe has great coverage all over Europe and I never had any problems in Europe always had bars.  They all share the towers with each other so all the cell phones work no matter where you are.  Not that way here in the US.  Each company has it good and bad points but when it comes to coverage Verizon does bet all the other providers out there and there is no question on that extent.  Sure you will find areas where Verizon does not have coverage but here is the kicker you will find less of them with Verizon than if you have the other players like AT&T and Sprint.  Everyone of the cell phone companies have policies that we as consumers do not like or agree with the key here is you signed the contract and no one twisted your arm to sign said contract.  Can there be improvements sure will they happen not unless the public steps in and stops using the cell phones or get the FCC to step in by filing so many complaints that the government has no choice but to step in to put control on the companies.  Remember the one year contract and the $75.00 cancelation charge if you wanted out... now it's two years and $175 but they did pro-rate that because the public made such a fuss that the cell phone providers stepped in before the government could step in.  This was a stop gap measure by the cell phone companies and was not for you it was to keep the FCC and government out of regulation of the industry.  Now Verizon is going to double the cancellation charge though it will still pro-rate that charge out for the months left on the contract.  If the FCC and government does not step in this type of stuff will keep going on.  So rather t
Thursday, November 05, 2009 1:39:24 PM
This will only highlight how bad AT&T's service is by bringing the problems to the attention of more customers.  Truth is a defense against libel.
Thursday, November 05, 2009 1:09:33 PM
AT&T Is the only carrier we would have. We live in colorado and spend allot of time in the mountains with service in areas that most don't have. I have two friends with verizon and they are changing from Verizon to AT&t because of the coverage we have in places they don't and due to the poor customer service they have experienced. We have had perfect customer service over the years. They must feel threatened by AT&T.  Plus reboot your phones one a week. turn it off then back on.
#13
Thursday, November 05, 2009 12:31:00 PM
It's funny to me how many people here whine about customer service and how "they" whomever they may be don't care about people.  Um no kidding these are massive corporations the only thing they ever cared about is your money.  If acting as if it makes any difference to them if you die right now, or that they truly love and care about you, makes them more money that it costs them they'll do it.
Thursday, November 05, 2009 12:06:05 PM

You could not pay me to be an AT&T customer. I had Cingular and dumped it as soon as I could when AT&T took over. They deliberately target elders and sell them land phone packages far beyond their needs...they sold my Dad one that cost 3 times what he was paying with Verizon and had all kinds of things he would never use. He could not hear well enough to understand what they were selling to him and I am sure the rep could tell he was just saying "yes" because he did not know what else to say. I was furious and it took me multiple calls to their obnoxious reps and finally a company VP to get even marginal satisfaction. I was home and overheard portions of the cold call they made and could tell they were shystering. The rep heard me ask my Dad to talk to them and I heard her say "NO, I do not want to talk to her." I wonder why. Not long afterward, Dad died and I switched the phone service to Cox and have never had an issue. The customer service is much better and they respond to issues with sympathy, not cold and callous comments and "so whats?"

I do not care if AT&T was the only service there was - service is not what they provide, at least not in any human sense.

Thursday, November 05, 2009 11:56:04 AM
AT & Crapple are jealous.  They wish they could be Verizon!
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