RealTime IT News

AT&T, Verizon Hang Up Their Lawsuits

Well, that was quick.

Last month, AT&T (NYSE: T) sued Verizon Wireless (NYSE: VZ) to stop advertisements from the carrier comparing the two companies' 3G network coverage. AT&T claimed that the ads, which portrayed Verizon as having far greater nationwide 3G coverage, were misleading.

AT&T has since launched an ad campaign of its own starring actor Luke Wilson, that touts AT&T's nationwide coverage.

A federal judge had earlier rejected AT&T's request to have Verizon Wireless pull the ads. A preliminary court hearing was set for December 16, but today the two companies announced a settlement though few details were forthcoming. A spokesman for AT&T sent the following statement to InternetNews.com:

"Verizon and AT&T have dismissed the litigation between them in Georgia and New York." AT&T filed its suit against Verizon in the U.S. District Court, Northern District of Georgia, Atlanta Division, while Verizon's countersuit against AT&T was filed in U.S. District Court, Southern District of New York.

The news comes at a time of a heated marketing battle among mobile providers, with Apple's (NASDAQ: AAPL) popular iPhone in the middle of it all. Despite the iPhone's popularity, users have complained about coverage issues from Apple's sole provider in the U.S., AT&T, which has been fodder for Verizon's ads.

AT&T's argument against the Verizon TV ads, which show side-by-side maps with colored 3G coverage areas for each network, was they suggest AT&T customers can't use their mobile phones or access the Internet unless they're in 3G areas. In fact, subscribers can make calls and connect to the mobile Internet in non-3G areas, they just have to do so on the slower 2.5G EDGE network.

Verizon tweaked the ads somewhat, making it clearer that the maps show only 3G coverage regions, as opposed to the slower 2.5G service, but refused to back down in a filing in response to AT&T's restraining order request.

Verizon Wireless told Reuters that its "There's a Map for that" ad campaign was continuing with the same language and the same maps as before.

Apple has stood up for its partner AT&T in some recent ads. One shows an iPhone user talking to a friend on the iPhone's speakerphone while surfing the phone's browser for information about movies and restaurants or accessing e-mail. A voiceover asks, "Can your phone and your network do that?"

Analyst Tim Bajarin said he didn't know why there was a settlement, but speculated that AT&T may have realized it wasn't in its best interest to continue the suit. "I think by suing Verizon, it forced customer to look harder at whether Verizon's claim were accurate or not," Bajarin, president of Creative Strategies, told InternetNews.com.