Time Warner Ad Misleads, Verizon Hammers Back with Lawsuit

April 11 – Time Warner Cable released a commercial advertisement recently that Verizon claims materially misleads the public about its new fiber optic service, FiOS. Verizon filed suit to stop Time Warner from continuing to air the ad. The most legally offensive portion of the ad claims that customers must have a satellite dish to obtain FiOS. Though Verizon customers can get service via satellite where FiOS is not yet available, the ad makes it seem as though it is the only way to get it. The ad also portrays a Verizon door-to-door salesman as an overeager technology expert (read: geek) that is trying to sell a product that is behind the times. Time Warner represents that their network is fiber optic and has been for ten years.

Recent commentary suggests that this is an over-aggressive move on Verizon’s part. Comments include calling it “fierce stupidity” and that Verizon is complaining about nothing. Though Verizon, too, has a history of misleading in the advertising realm, Verizon should not hesitate to force an aggressive campaign over Time Warner to set a precedent. The Cable companies have the market cornered with respect to premium broadcast channels, not only in terms of infrastructure, competition, and customer base, but also with the opportunity to portray new market entrants in a negative light.

Verizon does have the money to counter this advertising campaign, but companies like Time Warner should not be given the opportunity to make false representations of competitors. Cable companies traditionally have some of the worst reviews in terms of customer service dependability in programing. Customers are left with little choice because of monopolies on multi-dwelling units (recently changed by FCC order), already established neighborhood cable networks, and few companies that actually offer competitive prices and programming. Their grip on the industry is nearly to the choking point. Verizon FiOS, along with satellite television companies, present a very realistic and necessary threat to the lethargy of the Cable companies. If cable companies feel the squeeze of competition, they should not be able to use their monopolistic platform to shut out the competition with misleading information.

In addition to the misleading information regarding the need for satellite service to use Verizon FiOS, Time Warner claims that the company has used fiber optics for nearly a decade. Verizon looks as though it is joining the fiber optic game a little late. While it is true that cable companies and FiOS uses fiber optic cables, the more important aspect of Verizon’s new infrastructure is that it provides a viable competitor to the market. It appears as though cable companies are trying to refocus the debate to whether or not this is anything new in an effort to shadow Verizon’s potential to actually have customers satisfied with their cable television services. Further reading on how fiber optics works rather than traditional copper cable transmission is available here.

On a personal level, FiOS TV unquestionably beats out cable. The price is better in every respect for more channels in better quality. HD broadcasting is almost flawless nearly all of the time. Cable companies such as RCN HD broadcasting is grainy, freezes, and is often not dependable.

Verizon’s PolicyBlog has officially commented on this issue here.

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