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December 19, 2011

Cablevision, Verizon Settle Legal Dispute over FiOS Commercial

By Erin Harrison, Executive Editor, Cloud Computing

After filing a lawsuit earlier this month, Cablevision reached an agreement with Verizon Communications, settling the false advertising matter out of court, according to media reports.

Cablevision Systems (News - Alert) Corp. said Monday that it would dismiss a lawsuit it filed earlier this month against Verizon (News - Alert) Communications Inc. for allegedly misleading consumers about the speed of Cablevision’s Internet services, Reuters reported.

Only hours before the parties were scheduled to appear in a U.S. District Court in New York on Dec. 19, the companies announced they settled their dispute without disclosing terms of the agreement, according to media reports.

Over this weekend, Verizon stopped running ads that criticized Internet speeds offered by Cablevision’s Optimum (News - Alert) Online service.

“The Verizon ads ran their course, and ended Saturday, December 17,” spokesman Bill Kula told Fierce Cable. “We’re not providing a specific date as to when our new advertisements will start in the New York DMA.”

Citing court filings, Reuters (News - Alert) said that in court papers filed Dec. 12, “Verizon said it had agreed to modify portions of the ads in question to address Cablevision’s allegations. It will no longer refer to the FCC (News - Alert) report as ‘new’ or ‘recent’ and will stop asserting that the study pertains to Cablevision’s ‘current’ speed performance.”

In response to the advertising campaign being aired by Verizon, Cablevision Systems filed a lawsuit on Dec. 6 to put a stop to the wireless carrier’s FiOS commercials, which allegedly made false claims regarding Cablevision’s high-speed Internet service, TMCnet reported.

Cablevision said Verizon’s claims were based on an outdated Federal Communications Commission study that has since been updated.

In the lawsuit filed in the U.S. District Court for the Eastern District of New York, Cablevision accused Verizon of running a deceptive advertising campaign based on a study from the FCC that shows Cablevision’s Internet service only runs at 59 percent of its purported Internet speeds during peak hours.

The FCC study, which was released in August, shows that Cablevision’s older hardware means that many users have found significantly slower than advertised speeds. However in a blog post, Joel Gurin, chief of the FCC’s consumer and governmental affairs bureau wrote that Cablevision “markedly improved” its average download speeds in October.

Cablevision, meanwhile, noted that the FCC recently reported that Cablevision is delivering substantially faster Internet speeds than Verizon’s advertisements claim they are.

“Cablevision’s average download speeds are in excess of 90 percent of advertised broadband speeds during peak hours of use, and are above 100 percent of advertised speeds on a 24-hour basis,” according to a previous statement released by Cablevision.

Erin Harrison is Executive Editor, Strategic Initiatives, for TMC, where she oversees the company's strategic editorial initiatives, including the launch of several new print and online initiatives. She plays an active role in the print publications and TMCnet, covering IP communications, information technology and other related topics. To read more of Erin's articles, please visit her columnist page.

Edited by Carrie Schmelkin

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