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TBU8
join:2003-01-26
Memphis, TN | 15MM dollars for 60k customers? What do you guys think of Vonage's business plan?
Can they sell that kind of return to the investment banking
community? | |
|  clecrupt9
join:2002-01-22
GA
| Re: 15MM dollars for 60k customers? Well, 60k is drop and I mean drop in the bucket for residential line services.
I think a serious concern for an investor would be the regulatory climate and if the forecast is sunny for VoIP.
One bid disadvantage is the fact that any company can offer this service. AT&T is proof of that, and a company like AT&T has much more resources to play with than any startup. If VoIP really get traction, it will probably become the domains of the AT&T's, the Bellsouth's, ect. Perhaps one of them would buy Vonage, I dont know. Cable is very much along those line too. | |
| | p2pvoice
join:2003-10-28
Dover, NH
| Re: 15MM dollars for 60k customers? said by clecrupt9  :
Well, 60k is drop and I mean drop in the bucket for residential line services.
Precisely because the telecom market is so huge, an investment bank report (posted on Vonage corp site) asked a "tongue-in-cheek" question: Microsoft - Are you listening?
In any case, if the big guys want to get in on it, someone would acquire them for a good chunk of change!
I think they will end up making a lot of money.
Kanti | |
| | | clecrupt9
join:2002-01-22
GA
| Re: 15MM dollars for 60k customers? said by p2pvoice :
: Microsoft - Are you listening?
In any case, if the big guys want to get in on it, someone would acquire them for a good chunk of change!
I think they will end up making a lot of money.
Kanti
What does a company like Vonage have that Microsoft couldn't do themselves?
P8 is a better buy if only because there is some sort of proprietary gear. Anybody can buy an ATA, even further anybody can roll out services with an ATA. This is a significant factor in what ultimately happens.
Today I believe that any of the big telco's could take 6 months or a year and have a P8 or Vonage service. They have so many customers and such brand recognition and so much money to market that they would own this market. This assumes the telco's have the balls and smarts to execute.
But I could be wrong, and perhaps Thier is an ACE up someones sleeve. | |
| | | | p2pvoice
join:2003-10-28
Dover, NH
| Re: 15MM dollars for 60k customers? I understand your viewpoint. However, if you look at Microsoft's history (or even Cisco'), they have acquired hundreds of company's - large and small (placeware for web confernecing is a good example) - and continue to do so.
Why? Becuase, all things being equal, it is cheaper and easier to acquire technology and customers, and get to the market faster. If the general argument that big comapnies have resources to do just about anything, we wouldn't have so many acquistions.
BTW, I don't know about P8's propprietary technology. I'll appreciate an update.
Kanti | |
| | | | | clecrupt9
join:2002-01-22
GA
| Re: 15MM dollars for 60k customers? I agree. Often the view from the top floor is different than the the street level. Sometimes its also easier to buy a competitor than it is to compete against that competitor.
I still see Bell/cable coming out as a winner in part because of the ability to replicate this service, they own most of the high speed internet lines that these services run on, and because the service is not radical enough to separate itself from the Telco's. That is that if and when a Bell seriously markets its broadband phone service, Vonage could be seen as the lesser known and potential less stable company.
We talked about the first one and how in 6 or so months you can roll this out. The second point could prove crucial and were seeing that owning "network" is a huge advantage when selling internet based services. Look at how many people use their cable/rboc ISP for email, web portal, and other web services. It is a natural fit for an ISP to market this directly to is existing user base.
Not radical enough means that for all purposes, this is still a "landline". Sure people can take it with them and they can do some things not available, like select out of area codes and have real time CDR(call detail recording i.e. call logs) but most people don't move the ATA all that much. And you still have 911 issues and ISP stability problems that will prevent millions from using. The key for this will be some kind of killer app that moves this services out of "landline" status. 802.11 and IP centrex with email and such will help.
In the business world now more than ever people really don't want to leave the RBOC for local service because of the risks that service will be poor, or company will go under. While residential isnt quite as bad, and often price rules the day, broadband phone providers could have a tough time competing with AT&T's, Bellsouth's, and Comcast's IMO should they enter this same space and AT&T already has.
P8 developed its own hardware such as the DTA which is similar to the ATA. As I understand it they also developed their own softswitch and they make microelectronic components. In theory they should have some leverage provided that this hardware will allow them to offer services no other can.
[text was edited by author 2003-11-02 10:25:47] | |
| | | | | | | | | | | | | clecrupt9
join:2002-01-22
GA
| Re: 15MM dollars for 60k customers? Yep, and we might see that offered. Right now though, the Bells seem very scared to offer anything other than POTS with DSL. They loose hundred's of thousands of landlines per month because of cell phones already.
AT&T has all the pieces needed and probably would offer a DSL/CDS combo. But Cable still has the upper hand when they bundle TV and especially video on demand with phone and internet for like 80-100 bucks.
I have no idea how the Bells will compete if the Cable companies do this the right way. Now you have the real main argument against cable being network stability. We know that networks and computers do get better with time, so its only around the corner that there may be no difference whatsoever in going DSL vs Cable except price. And the Cable company looks to kill with possible pricing. AT&T (and the Bells) need some kind of video offering yesterday. | |
| lestat99
join:2000-08-04
Piscataway, NJ
| The problem here is that the barrier to entry for this type of service is extremely low. So for a company to acquire one of these existing voip companies would be also be low.
This has been exemplified by the cable companies such as CableVision and AT&T rolling out their own VoIP service vs. acquisition.
Buying the customers in the situation wouldn't be very prudent. Any of the prospective suitors (Verizon, Sprint, cable companies, etc) already have their own customer to base, and a much larger one at that, to leverage.
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