7 Comments

Summary:

[qi:86] It could pass as a cute little gesture, but somehow it smacks of desperation. The beleaguered VoIP service provider, Vonage (VG) has been in a ton of trouble, getting sued left, right and center by any telco with a VoIP-related patents. The legal worries are […]

[qi:86] It could pass as a cute little gesture, but somehow it smacks of desperation. The beleaguered VoIP service provider, Vonage (VG) has been in a ton of trouble, getting sued left, right and center by any telco with a VoIP-related patents. The legal worries are causing potential customers to pause and rethink before signing up for Vonage’s service. In order to lure them, Vonage has introduced a new website, VonageLovesYou.com, and is offering three months of phone service for $9.95-a-month, and is throwing in a free router, just to sweeten the deal. (Thanks to all of you who sent this tip.)

  1. Holy Toledo! I have not looked at their balance sheet lately, but it has to be bleeding lots of red.
    1) Promotion that is costing them money. Router costs is probably greater than $25 alone.
    2) Sprint lawsuit $80M
    3) Verizon lawsuit $58M
    4) AT&T lawsuit TBD

    5) 5.5% royalty to Verizon going forward (new sales)
    6) 5% royalty to Spring going forward (new sales)
    7) AT&T royalty – TBD

    8) Customer acquisition costs?
    9) Increasing customer churn

    …..damm, this does not look good for Vonage shareholders,imo.

    Share
  2. with all the cash they collected in IPO, sure the’ll love us

    Share
  3. 6) 5% royalty to Spring going forward (new sales)

    I don’t think that they have to pay Sprint a percentage. I thought that they did a settlement with Sprint and that did not include a percentage…

    http://www.redherring.com/Home/22938

    Share
  4. …and i love vonage back, seriously, my bill is always low, like under 25ish bucks, and i used to pay over 80 for identical services and features…plus it’s backup – isn’t everybody all mobile now???

    Share
  5. Seems like a router has always been tossed in though. I got mine for free and didn’t do any special deal.

    Share
  6. roman nakonechnyy Monday, January 7, 2008

    Gees vonage’s sucks when my v-tech modem device broke nobody came to fix it or even answer hundreds of times I called vonage to help me fix the phone they charged me for 2 months but it still not fixed

    Share
  7. [...] Berninger, Friday, January 18, 2008 at 12:00 AM PT Comments (0) The $250 million Vonage burned through as a result of the patent lawsuit brought by Verizon et al provides yet another example of why [...]

    Share

Comments have been disabled for this post