Sprint Sues AT&T Over Its Fake 5G, Says AT&T's Tricking Consumers

Legal Issues

from the false-and-deceptive dept

Big telecom operators haven’t been exactly honest when it comes to the looming fifth-generation wireless standard (5G). Eager to use the improvements to charge higher rates and sell new gear, carriers and network vendors are already dramatically over-hyping where the service is actually available, and what it can actually do. Some, like AT&T, have gone so far as to actively mislead customers by pretending that its existing 4G networks are actually 5G. AT&T took this to the next level recently by issuing phone updates that change the 4G icon to “5GE” on customer phones, despite the fact that actual 5G isn’t really available.

In a country with functioning regulatory oversight, a competent regulator would at least issue a statement pointing out that misleading consumers in this fashion is false advertising. Instead, AT&T executives, FCC regulatory capture in tow, have quite literally expressed glee at the consternation their 5G head fake is creating among consumers and competitors alike:

“Every company is guilty of building a narrative of how you want the world to work, and I love the fact that we broke our industry’s narrative two days ago, and so they’re frustrated and they’re going to do what they do,” Donovan said.

“I think the result of last month, beating the industry out [with the 5G hotspot], and this 5G E launch a couple of days ago, our competitors are frustrated,” Donovan said. “if I have now occupied beachfront real estate in my competitors’ heads, that makes me smile.”

Late last week Sprint decided to respond by filing a lawsuit against AT&T in US District Court for the Southern District of New York, arguing that the “significance of AT&T?s deception cannot be overstated.” AT&T’s practice likely qualifies as “unfair and deceptive” under the FTC Act, and Sprint argues that the head fake is potentially costing it customers as consumer buy into the fact than AT&T’s ahead of the curve on 5G upgrades:

“AT&T has sought to gain an unfair advantage in the race to 5G by embarking on a nationwide advertising campaign to deceive consumers into believing that its existing 4G LTE Advanced network is now a 5G network…But calling its network ?5GE? does not make it a 5G network and instead deceives customers into believing it is something that it is not…AT&T’s false and misleading statements deceive consumers into believing that AT&T now operates a 5G wireless network and, through this deception, AT&T seeks to induce consumers to purchase or renew AT&T’s services when they might otherwise have purchased Sprint’s services.”

AT&T’s likely to argue that its “5G E” or 5G Evolution technology really does offer faster speeds and better range than traditional 4G by incorporating 4×4 MIMO (multiple input, multiple output) antennas and 256 QAM technologies. Still, that’s just an “enhanced” version of 4G, something AT&T tries to tap dance around by using the “E.”

However AT&T lawyers frame the company’s defense, it’s very clear AT&T’s still being misleading. Companies that think they’re building consumer excitement by misrepresenting what 5G is or where it’s available may find this kind of marketing is having the exact opposite impact (frustration, skepticism, distrust) their marketing departments originally hoped for.

Filed Under: 5g, 5ge, mobile broadband, truth in advertising
Companies: at&t, sprint