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Vonage Owes Verizon $120 Million
Appeal request refused...
by Karl Bode 03:29PM Friday Nov 16 2007 Tipped by laserjobs See Profile
Bloomberg reports that Vonage must pay Verizon $120 million after a U.S. appeals court
Click for full size
refused to reconsider the case. The ruling certainly does little to help Vonage's mounting debt load.
quote:
Vonage settled the infringement suit on Oct. 25 after Verizon won both a jury verdict and an appeal in the case. The accord left open the amount to be paid until the appeals court decided whether to grant Vonage's request for reconsideration.
Vonage saw a third-quarter net loss of $162 million -- thanks in large part to the $133 million spent last quarter on legal costs related to their patent battles with Sprint, Verizon and AT&T.

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PhoenixDown
FIOS is Awesome
Premium
join:2003-06-08
Fresh Meadows, NY
kudos:1

Can Vonage float it or is this the death bell?

...
satellite68

join:2007-04-11
Louisville, KY

Re: Can Vonage float it or is this the death bell?

let's do the math:

1 million subscribers (my estimate, probably higher than that) x $25/month (on average, probably a little lower with all the plans they have) = $25,000,000/month.

i'm guessing their overhead ain't $25 mill a month.

dunno, hope they go far. love the service.
mikenolan7
Premium
join:2005-06-07
Torrance, CA

Re: Can Vonage float it or is this the death bell?

According to Wikipedia:

"Until recently Vonage held the most subscribers at 2.4 million subscriber lines"

They "until recently" part had to do with Comcast passing them with 5 million, not any statement that the 2.4 million had dropped.

Hehe

@ssa.gov

Poo

I hate all the sueing!

burgermeister
All Computers Are Junk

join:2000-10-23
Utica, MI

Re: Poo

Yeah, it seems like such a waste of money, but, companies have to protect their intellectual property, I suppose.
--
"I've learned that depression is merely anger without enthusiasm."

anoooon

@comcast.net

This is so wrong...

A company like this shouldnt have been sued so badly....

gatorkram
Need for Speed
Premium
join:2002-07-22
Winterville, NC
kudos:3

Ah HA!

So this is how Verizon can afford to roll out all these wonderful speeds over their FIOS network..
--
Give me bandwidth or give me death!
»/testhistory/661871/4f240

Cabal
Premium
join:2007-01-21
Reviews:
·Suddenlink

Where are Vonage's defensive patents?

Everyone in the tech sector knows the patent system is broken (or at least has very significant flaws), but because everyone plays the game, that means you have to, too. Where are Vonage's defensive patents? I work in the VoIP sector, and while I'm sure we are violating someone's patents, we have plenty of our own that keep the big dogs off our backs. Was someone at Vonage planning, ever?
--
Interested in open source engine management for your Subaru?

FFH5
Premium
join:2002-03-03
Tavistock NJ
kudos:5

And the Shareholder suits haven't even started yet

Vonage, which first sold shares to the public for $17 each in May 2006, also faces suits from investors. They say the company's prospectus misrepresented or omitted information about its products and the experience of some managers.
The IPO was for $17/sh and the shares are selling for $2.13/sh now. Those suits and the banks wanting their money on the loans could sink Vonage by mid year 2008.
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Internet News
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bngdup

join:2007-02-20
Old Bridge, NJ

Re: And the Shareholder suits haven't even started yet

Ahh yes the armchair accountant who keeps extending his "Vonage is Dead" prediction on each post.

I can make up arbitrary dates too!

Vonage's various legal and financial troubles could bring it down by March of 2009.....see its real easy

supergirl

join:2007-03-20
Pensacola, FL
said by FFH5:

Vonage, which first sold shares to the public for $17 each in May 2006, also faces suits from investors. They say the company's prospectus misrepresented or omitted information about its products and the experience of some managers.
The IPO was for $17/sh and the shares are selling for $2.13/sh now. Those suits and the banks wanting their money on the loans could sink Vonage by mid year 2008.
If Vonage has only about $155 million in cash, how will they pay it and keep operations going at their ridiculous ad rate expenditures?

Firing Citron would be a good idea. Not sure if any manager with brains would want to run this loser.
--
Saving the world keeps me busy. However, I find Earth very primitive from my home planet of Krypton.
-Supergirl
dualsub2006

join:2007-07-18
Newport, KY

Re: And the Shareholder suits haven't even started yet

said by supergirl:

If Vonage has only about $155 million in cash, how will they pay it and keep operations going at their ridiculous ad rate expenditures?
$98 million of this is already set aside:

»pr.vonage.com/releasedetail.cfm?···D=271491

I don't recall all of the details, but the appeal or something was only allowed because they had set aside $66 million or something and then they were required to make quarterly escrow payments on top of that.

The other $22 mil or so will come out over time.

AlsknSnoBals

join:2007-05-17
Anchorage, AK

It's kind of funny.....

It's kind of funny that nobody took notice of Vonage until they became successful. I would be willing to bet they never had a patent infringement until they started making money, which the telcos hate. It is very reminiscent of the old Tucker case when Ford and General Motors took him to court so they could put him out of business. Afterward, they cannibalized Tucker's design.

After Vonage, Bell started their own voip too. So did everybody else. In the meantime, after Vonage's death blow, voip will become just as expensive as land lines with minimal overhead for Bell. That means it will be pure profit.
paulme

join:2007-11-06
Kirkland, WA

Re: It's kind of funny.....

said by AlsknSnoBals:

It's kind of funny that nobody took notice of Vonage until they became successful. I would be willing to bet they never had a patent infringement until they started making money, which the telcos hate.
Well... yes, why would you go to the trouble of suing someone who didn't have any money. Its the way that industry works. Those making money get sued (a lot).
Redbaron2

join:2004-06-14
Tacoma, WA
Tell me about it VerIZsuen has had a stick up its backside since Vonage took most of their subscribers. This is just VZ trying to re-coop their loss instead of being competitive in the marketplace. The Big 3 had it in for Tucker because he was making a safer car then they could for an afordable price. Safety Glass, Disc Brakes, and pop out windows to name a few of Tucker's innovative ideas. These made the car impressive, and of the entire run of cars; nearly all of them are drivable to this day (and are driven often). This isn't the only time the big 3 went after the little car maker. They went after one of their own designers with threats and ruined his company, life, and reputation. The DMC and Bricklin SV-1 both were put of business by shortsighted Car executives who wanted the big bucks. VZ, Sprint, AT&T, and others are looking to kill competition/diversity, and fair market practice just because they are losing money. Grow up and get a life. Stocks are risky live with it instead of suing. The pledge should state "The home of the sue happy and proud."
rradina

join:2000-08-08
Chesterfield, MO
According to the Verizon suit, they did not know what technology Vonage was using until they filed information for their public IPO. Only then was Verizon able to determine that they had patents covering the technology that Vonage was using.

Does anyone know if the work-arounds that Vonage claimed to have are in place and being used or will they continue to owe Verizon for each VOIP customer?

Rob
In Deo speramus.
Premium
join:2001-08-25
Kendall, FL
kudos:2

Take over..

Would it be possible for Verizon to take control of Vonage in lieu of the $120 million outstanding debt?
zed2608
Premium
join:2007-09-30
Cleveland, TN
kudos:1

1 edit

Re: Take over..

not likely unless they wanted to buy vonage which i doubt

besides i think once you ad the at&t into it they will likely go into debt
rradina

join:2000-08-08
Chesterfield, MO

Re: Take over..

Consider that AT&T and Verizon may own the same patents since they were at one time the same company.
zed2608
Premium
join:2007-09-30
Cleveland, TN
kudos:1

Re: Take over..

consider that at&t broke up in into the baby bells in 1984 any patents that at&t had then are now in public domain so they no longer have same patents
rradina

join:2000-08-08
Chesterfield, MO

Re: Take over..

Really? When a company is broken up, they lose all of their patents?
zed2608
Premium
join:2007-09-30
Cleveland, TN
kudos:1

1 edit

Re: Take over..

no they dont but the patents that existed then would have expired by now

in the us patents only last 20 years at the most

»www.freepatentsonline.com/help/i···ire.html

dodgetech2

join:2002-01-01
Gouldsboro, PA
said by Rob:

Would it be possible for Verizon to take control of Vonage in lieu of the $120 million outstanding debt?
Lets not even joke about that.
rradina

join:2000-08-08
Chesterfield, MO

Re: Take over..

I didn't even think of that. It has been that long. Wow. Time flies.

coax2112

@charter.com
I LOVE VONAGE NEVER HAD A PROBLEM IN TWO YEARS WEBSITE HAS EVERYTHING YOU WOULD EVER NEED ABOUT YOUR YOUR SERVICE I WOULD RATHER GIVE THEM $5.00 MORE PER MONTH OR MORE THAN GIVE VERIZON ANYTHING

dowhattowho

@98.18.28.x

BYE_BYE

If SPRINT ( AIRAVE ) actually works Then it's just a matter of time for pots - cable voip - and vonage. »www2.sprint.com/mr/news_dtl.do?id=18000
JohnA
Premium
join:2003-09-16
Pittsburgh, PA

Wednesday


This was Wednesday news, and the Sprint, and full amount of the Verizon settlements were booked in the third quarter, so Vonage is surviving at this point.

GilbertMark
Premium
join:2001-05-02
Gilbert, AZ
Reviews:
·CenturyLink
·Cox HSI

Yes

Vonage you better not let me down! I have proclaimed die Vonage die everytime this story pops up. I will consdier this my Christmas present if you disappear in the next few weeks.
--
»hacktheiPhone.com
ImBatman

join:2004-04-21
Lancaster, CA

Re: Yes

said by GilbertMark:

Vonage you better not let me down! I have proclaimed die Vonage die everytime this story pops up. I will consdier this my Christmas present if you disappear in the next few weeks.
Dont count on it.
vonage seems to be run by relatively intelligent people. They were smart enough to put money aside, and still have a profit margin, after several lawsuits.
Their stock may be down; but i'm looking for it to return.
Anyone have several million I can borrow, to buy up tons of vonage stock?

batterup
I Can Not Tell A Lie.
Premium
join:2003-02-06
Netcong, NJ

Turn out the lights

the party is over.

Where are all of the legal eagles that said Verizon's suite was without merit?