Competitors seek an end to legal fight on ad claims
Cingular Wireless LLC and Sprint Nextel Corp. are pursuing a settlement in their increasingly nasty legal battle over the accuracy of their calling network advertising claims.
A settlement would bring to an end a high-stakes legal bid to claim bragging rights to the best wireless network, a key selling point for consumers purchasing wireless service. Cingular and Sprint declined to comment yesterday.
All of the major wireless carriers except T-Mobile like to boast about their networks. Verizon Corp. says its network is the most reliable. Sprint says ``no one has a more powerful network" in cities such as Boston, Chicago, and Denver. Cingular says it has the ``fewest dropped calls" nationally and the best and most reliable network in specific markets, such as San Francisco.
But none of the carriers has been forthcoming with much evidence to back up their claims.
Sprint challenged Cingular's advertising in an April complaint to the National Advertising Division of the Better Business Bureau. Cingular countered by dragging the matter into federal district court in Georgia, asking a judge to referee the dispute over whose network is better.
Cingular claims Sprint's network is nowhere near as powerful as its own, pointing out that it has nearly twice as many cellular towers and much broader coverage and service options.
Sprint recently filed a counterclaim in the case, alleging that the data on which Cingular based its ``fewest dropped calls" assertion doesn't stand up to scrutiny.
Cingular's massive, multimillion-dollar national advertising campaign is based on data from ``the leading independent research company," which Cingular officials have identified as Telephia of San Francisco. Neither Cingular nor Telephia have released data backing up the assertion.
Telephia Inc.'s president, Sid Gorham , sent a letter to the four major wireless companies in May saying Cingular had a ``statistically significant lower dropped-call rate than the competition across some market/time period groups," but noted that his company never analyzes its own data and couldn't say whether Cingular's ads were ``fair, legal, or responsible."
Sprint, in its counterclaim, said the Telephia research does not reflect an average wireless customer's usage . Sprint said Telephia collected its data by making calls on major highways and not on smaller streets or from inside buildings, where reception is more difficult.
Sprint also said Telephia conducted its Cingular road testing using the Motorola T720 phone, which hasn't been widely used for two years and has an external antenna that yields better reception. Sprint said most phones now use internal antennas.
``The Telephia methodology and results are not representative of actual consumer use and provide no substantiation for and certainly do not `prove' Cingular's unqualified `fewest dropped calls' claims," Sprint said in its counterclaim.
Sprint said Cingular's advertising blitz has caused Sprint great harm in terms of lost customers. The company said damages are difficult to estimate, ``but will likely be millions of dollars."
The companies seemed headed for a court showdown until they agreed to a consent order giving them time to pursue a private settlement of their dispute. In an order signed by US District Court Judge Charles A. Pennell Jr. , Cingular and Sprint agreed to continue settlement discussions at least through the end of this week.
Bruce Mohl can be reached at mohl@globe.com. 