Sprint sues AT&T over false 5G claims

By TechnologyFOXBusiness

Is now the time to bet on 5G?

B Riley FBR chief global strategist Mark Grant on the state of the U.S. economy, the Federal Reserve’s rate hikes and where investors should allocate their capital.

Sprint is suing AT&T over allegations that the nation’s largest wireless provider misled consumers with false claims it was offering fifth-generation wireless technology, highlighting the intense battle between telecom firms to be the first to market with the faster network.

Continue Reading Below

AT&T recently started putting 5G E – or 5G Evolution -- instead of 4G on its phones. In reality, the network is just the 4G LTE that is used by competitors Verizon, T-Mobile and Sprint. A company executive in January said it’s “an indicator that said your speed now is twice what it was with traditional 4G LTE.”

Sprint did not view it as such.

The campaign is an effort “to deceive consumers” that was used to give the company an “unfair advantage” in the race to 5G, which promises to offer broadband speeds without a hardwire connection, the company alleged in its suit.

MORE FROM FOXBUSINESS.COM...

“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,” the lawsuit reads. “AT&T’s behavior violates federal and state laws governing false advertising and deceptive acts and practices, and must be immediately enjoined.”

Sprint is seeking unspecified damages as a result of the loss of sales. In a statement, AT&T said it understands why competitors don't like the campaign but "customers love it."

"Customers want and deserve to know when they are getting better speeds. Sprint will have to reconcile its arguments to the FCC that it cannot deploy a widespread 5G network without T-Mobile while simultaneously claiming in this suit to be launching ‘legitimate 5G technology imminently,'" a spokesman said.

TickerSecurityLastChange%Chg
SSPRINT CORP.6.36-0.11-1.70%
TAT&T INC.30.68-0.12-0.39%
TMUST-MOBILE US INC72.59-1.09-1.48%
VZVERIZON COMMUNICATIONS INC.57.50-0.57-0.98%

T-Mobile, which is trying to win federal approval for a $26.5 billion merger with Sprint, has also criticized AT&T’s campaign. And Verizon recently launched an ad campaign promising it won’t take old phones and “change the software to turn the 4 in the status bar into a 5.”

Still, AT&T remains defiant in its decision.

"It's not a play everybody can run. It's a play that we really like, and it's a play that's going to differentiate us in the marketplace as we begin to roll this out over the course of this year,” CEO Randall Stephenson told CNBC.

CLICK HERE TO GET THE FOX BUSINESS APP

From health care, to investing and manufacturing, 5G technology holds immense promise to greatly enhance latency speeds and usher in a new era of connectivity. Faster wireless connections, for example, could improve the ability of doctors to treat patients remotely – a benefit for rural areas that have been plagued by hospital closures and doctor shortages.