Comments on: Vonage: Rocky Road, not Road Kill

By: Dave

Dave — Thu, 27 Sep 2007 21:55:05 +0000

I've had Vonage for over 2 years, and I have had mostly good service. At least as good as previous experiences with Bellsouth, and saving many dollars over the long run.

Competition in these basic telecommunications markets is vital, or we'll all just get royally screwed by the big boys.

By: dagamore

dagamore — Sun, 12 Aug 2007 20:20:58 +0000

Don’t know what all the hate for Vonage is about. I use it all the damn time for work, and I live in Germany. Most of the issues about call quality/call drops are caused by the ISP. If I put the Vonage phone on my 16Mb Cable I get a very poor connection. But I move it to my 1Mb DSL I get a great connection. Could most if not all of the issues be due to people using a shared bandwidth ISP? Probably.

By: anonymous

anonymous — Sun, 20 May 2007 02:40:58 +0000

I do not recommend that you subscribe to Vonage. I have a good ISP and connection. I have bad Vonage. Echos on the line, static, deleyed or no voice mail, no customer service, lies and inaccurate billing.

By: Vonage goes bankrupt

Vonage goes bankrupt — Fri, 04 May 2007 02:50:59 +0000

cash burn thru about Oct 31–hope they melt down and close down

By: AnonymousMT

AnonymousMT — Thu, 19 Apr 2007 22:09:19 +0000

People do stupid things, like buying Vonage Stock in an IPO. $3 and falling.......

Companies do stupid things, like infrige on Verizon patents. Bankruptcy ahead !!

By: Anonymous

Anonymous — Mon, 16 Apr 2007 00:16:39 +0000

Vonage is a loser. The leadership is a loser ant they quit. They copies patents. They can’t develp thier own technology. They are losers.

By: MikeT

MikeT — Sun, 15 Apr 2007 00:35:00 +0000

I am a long time Vonage customer and find the quality great. The voice quality is superior. I will hang in because I think they have the right idea and competition is healthy. The split ring and the ability to look up call history makes it well worth the very low rate.
Long Live Vonage.

By: Anonymous

Anonymous — Mon, 09 Apr 2007 22:53:02 +0000

I will not stick by Vonage. They have poor line quality, poor voice quality and thier voice mail often does not work. When I get me change, I am leaving.

By: Eric Chandler

Eric Chandler — Sun, 25 Mar 2007 00:03:04 +0000

Vonage has had its ups and downs. Lately, it’s been downs from a media perspective. I’m a Vonage customer and will stick by them to the bitter end. My service is great, and I love the features (especially the emailed voicemail and simulring). I’ve had but 4 dropped calls, and each was my cable company’s fault as they had reset my modem. I’m beginning to think that the cable companies are either blocking random calls, or tweaking their systems to cause Vonage and other SIP suppliers to lose calls randomly, if only in an effort to stifle competition that is eroding what few customers they have. They lose customers to companies like Vonage, since their introductory rate of $29.99 lasts 6 months and then jumps to $39.99 from there on, and won’t even include European countries as a free call. I frequently call the UK whenever I want for free with Vonage for $24.99 a month.

What I do see is Verizon going for the jugular on Vonage, when Vonage is just one of many SIP suppliers in the industry. If Vonage is infringing on Verizon’s patent of parts of this open protocol, then so is Skype and the others. Having personally read through these patents (I’m in Telecom), I can see why Verizon patented what they did - not to protect their IP, but to stifle competition in the future (which is now). They already have a few pair of wires to every house in their controlled regions, negating the need for VOIP as it is. It turns out that their outsourced VOIP venture has only 15,000 customers as well, which is either the worst attempt at a business, or a good front to show that they need these broad patents of the SIP protocol.

From their press release, Vonage will be fighting the juggernaught tooth an nail, and I’ll support their underdog fight. I left Verizon after paying $68.00 a month for a simple land line. For even a few dropped calls a week, I’d gladly pay the $24.99 hands down, and I love sticking it to Verizon in the process. Would you rather pay $816 a year or $300 a year like I’m paying now? Makes you wonder what Verizon’s profit margin is and what it actually SHOULD be.

By: We HATE Vonage

We HATE Vonage — Sat, 24 Mar 2007 02:54:52 +0000

Vonage lost its patent case–time to pay up.

By: we HATE vonage

we HATE vonage — Wed, 21 Mar 2007 05:41:36 +0000

Any analysis that fails to take into account the very high cost to acquire a new customer and the high customer loss rate cannot be a good analysis. I am a Vonage customer and I HATE VONAGE. I will be leaving them soon, as soon as the penality phase of the contract is up. I will tell anyone that will listen how poor the customer service is, that my Vonage Service (not my IP sevice) fails several times a week and how calls are dropped in mid sentence. Am I alone? Well just Google “Vonage and hated” and see what you get.

By: RandomThoughts

RandomThoughts — Mon, 19 Mar 2007 13:53:50 +0000

Even without the payout to Verizon, I think most questioned Vonage’s business model. Voice is trending to zero, without the ability to offer other value added services, I just don’t see Vonage sticking around long term. Its not just the Bells that Vonage has to worry about, but probably a tougher competitor in the cable companies.

The power of the bundle will really put the squeeze on pure-plays, and once fiber to the home and curb are more mature, I think you will see voice prices really drop. When that happens, what happens to the companies that can’t offer video?

Of course, thats not to say that Vonage won’t continue to innovate, but on voice alone, I don’t think Vonage has a long time future.

By: Rick Calvert

Rick Calvert — Sat, 17 Mar 2007 16:57:38 +0000

great post Dan. Hopefully not only will Vonage survive and thrive but so will several other smaller VoIP's.

More competition is always better for consumers.

By: Dan

Dan — Sat, 17 Mar 2007 15:28:12 +0000

AT&T’s CallVantage isn’t off the market, they’re just not actively marketing it.

See: (link)

This stuff is a commodity. Consolidation time looms. It’ll be Vonage by AT&T or Vonage by Verizon, or perhaps even Vonage by AOL, soon enough.

By: Markus Goebel

Markus Goebel — Sat, 17 Mar 2007 14:09:23 +0000

This story all reminds me of Amazon's early years. I thought they never would be profitable and the billion dollars venture capital would be lost very soon. All the old school book vendors were saying that Amazon would dissapear because you need real life shops to sell books.

Well, Amazon is still there and one of the biggest book vendors worldwide. It's long ago that I heard those nasty comments about Amazon being only a cash burn machine.

I think Vonage could be the same. Maybe one day all the negative comments, that are so easy to make from the actual situation, are forgotten like the anti Amazon comments are today.

By: Daniel Berninger

Daniel Berninger — Sat, 17 Mar 2007 10:07:40 +0000

The point remains to separate conclusions supported by the numbers and conclusions supported a qualitative assessment of the competitive (anti-competitive) landscape. The numbers bode well for Vonage. Vonage generates positive cash flow from each and every customer. The losses are discretionary not structural. Vonage made the strategic decision to front end load customer acquisition. In the last century, customer acquisition meant building a network. Customer acquisition presently means building a brand. Vonage’s net loss as a % of revenue declines every quarter (145% in 1Q05 to 35% in 4Q06.) Vonage projects spending $400mn to add 800k subs in FY07 for 40% Y/Y growth. They could have easily decided to spend $100mn for 10% growth and ended the year with positive net income. With regard to the the qualitative threat posed by Verizon et al, Vonage has already proven it can take the hits. The telco’s have successfully hurt Vonage’s costs, but they have not found a way to reduce Vonage’s revenues. The misdeeds of the telco’s against VoIP designed to slow Vonage ends up protecting Vonage against price competition. Vonage did reduce prices in response AT&T’s original VoIP offer, but SBC showed up to take CallVantage off the market. The regional nature of the Bells means they need an (illegal) cartel to price against Vonage. Ditto the cable co’s.