Sprint aren't hitting below the belt. It's fair game and yes, a lot of agencies and brands have gone the same route. I'm not even arguing, other than the crappy network and lack of 4G, that there's any untruth to it. But calling out a competitor BY NAME is weak and generally doesn't work except to further cement you in the follower position.

Apple's I'm a Mac ads do come close to this type of advertising, but they have not solely focused on calling out Microsoft. They have mentioned Vista a few times, which I also think was weak, though amusing (because most of those ads are). Apple is clearly the number two OS and there's little chance of that changing any time soon. Those ads aren't an attempt to do so nor do they ever imply there's ever a chance of that happening. I think most of them make it seem like they're content to be number 2 in quantity, but that they're visibly and empirically number 1 in quality.

What Palm needs is some non-sprint advertising that focuses on the benefits of the products. And not how the product will bring you to a zen state atop a hillside. Apple's products establish the iPhone as an Apple product. Even though they have an exclusive with ATT in the US, the iPhone is the farthest mobile handset from "co-branded" as you will find out there right now. I suspect most people, even in the US, don't immediately associate the iPhone to ATT. Palm needs this kind of distinction to promote itself, rather than their current network partner. But yes, this was a Sprint ad, so that's unrelated to this ad.