Rick
Premium,MVM
join:2001-02-06
Waterbury, CT
clubs: 
| reply to DMS1
Re: Actually..
I'm not saying the deal won't benefit vonage.
Providing they make it, over the long term, this deal should prove to be better for them than a constant 5.5% of revenues royalty payment hanging over their heads.
It also puts the whole distraction of this suit to rest..and lets them get on with business.
Vonages big challenge now is to get profitable before their money runs out. And, at this rate they're burning through it very fast.
Their next challenge is surviving the threat from the cable co's and othe voip providers. Even AT&T is supposedly going to get into the game with uverse voip.
And finally, as for sprint..they know it can be an ugly business being involved in someone elses. And this lets them cut loose of this whole thing with Vonage..and move on themselves.
They get to bank or invest 80 million..which will certainly offset whatever a future royalty would have given them.
Plus..they don't have to proceed any longer with the legal process.
It's a good deal all the way around, but still the winner I think is sprint. After all, vonage IS paying them 80 Million.
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The Coyote captured the RR! Roadrunner Rick is now Comcastic! |
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vonageeeee
@sprintlink.net | reply to Rick
Vonage won't have to worry about Verizon on an ongoing basis now since they are using Sprint's technology. All they have to do is pay a fine and make sure they're not using any Verizon patent technology from here on out. |
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DMS1
join:2005-04-06
Carrollton, TX
| reply to Rick
said by Rick  :As for the deal, I guess it's good they get it out of the way but it still is very pricey for Vonage. The jury awarded sprint 58 Million + 5.5% of future revenues. This deal calls for a one time payment of 80 Million instead. I think the deal is about more than just playing with numbers. According to the MSNBC article here: »www.msnbc.msn.com/id/21192277/, Vonage gets a license for a hundred VOIP-related patents from Sprint. |
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Rick
Premium,MVM
join:2001-02-06
Waterbury, CT
clubs:
| the stocks up 78% right now.
If I bought recently, I'd sure be taking those one day profits.
As for the deal, I guess it's good they get it out of the way but it still is very pricey for Vonage.
The jury awarded sprint 58 Million + 5.5% of future revenues.
This deal calls for a one time payment of 80 Million instead.
While I guess over time that could benefit vonage..it is yet another big chunk of their cash they're blowing on their way to profitability. Not to mention the Verizon payment still pending.
I think Sprint made a wise decision and this will just let them bow out of the whole deal. Who wants to be bothered monitoring vonages future revenues..waiting on future payments..and hoping they survive to ever really realize the 5% returns?
This way Sprint can just take the cash and invest it..and easily get their own 5%..and more..returns on it.
For shareholders today..i'd take the 70% + returns on the stock..and run!
~Rick..
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The Coyote captured the RR! Roadrunner Rick is now Comcastic! |
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