Yes, if a simple unsubstantiated rumor is enough to get your competitors to spend potentially millions of dollars to fight you, that's a competition. Literally what else could it be?

It can be two things, anyways. You can utilize fraud to manage your competitors expectations. CEOs lie constantly about the state their products are in, in order to drum up more sales.

It has absolutely zero requirement to be beneficial to the public in order to be a competitive marketplace. They're also competing to make as much profit as possible, which has effectively zero benefit for the public.