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Vonage Hit With $69.5M Judgement 234

Posted by kdawson
from the hard-to-get-customers-after-that dept.
andy1307 writes "The Washington Post is reporting that Net telephone company Vonage Holdings Corp. was ordered in federal court Tuesday to pay Sprint Nextel $69.5 million in damages for infringing on six telecommunications patents owned by competitor Sprint Nextel Corp. In addition to the damages, jurors awarded Sprint Nextel a 5 percent royalty from Vonage on future revenues. It was the second verdict against Vonage this year. A jury in Virginia determined in March that Vonage had violated three Verizon patents in building its Internet phone system. The jury awarded Verizon $58 million in damages plus 5.5 percent royalties on future revenues. Greg Gorbatenko, a telecommunications and media analyst for Jackson Securities, said the decision 'feels like a death knell' for Vonage because future revenue will likely dry up, preventing the company from investing in better technology or improving customer service."
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Vonage Hit With $69.5M Judgement

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  • by Anonymous Coward on Tuesday September 25, 2007 @07:06PM (#20750449)
    ... they have destroyed VOIP as a threat, and they can go about their usual greedy, grasping ways. Sprint will raise a glass to Verizon and toast to their continued wealth.

    But there will come a day when we will kick their corporate corpses and spit on them.
    • by Anonymous Coward on Tuesday September 25, 2007 @07:15PM (#20750529)
      This is a perfect example of how patents utterly destroy innovation.

      Here we have Vonage, offering a novel and efficient solution to global communication. They're opening up new possibilities. Yet the incumbents dare not face true competition, so they quash this innovative burst of talent. And what do we get? Less innovation, and less economic efficiency.
      • by jelton (513109) on Tuesday September 25, 2007 @08:27PM (#20750995)
        This is a perfect example of how bad patent laws and poor bureaucratic administartion utterly destroy innovation.

        Fixed for you.
    • by NeutronCowboy (896098) on Tuesday September 25, 2007 @07:22PM (#20750577)
      No, they don't feel that they have destroyed VOIP as a threat. They've destroyed someone who was using VOIP to threaten their monopoly. I'm sure that we'll see Sprint, Verizon and ATT provide VOIP at some point as a legitimate alternate to a landline. And to some extent, they already do. But there will never, ever be a new company that will rely on VOIP to become a legitimate telco competitor. Because before that company will become a legitimate competitor, the incumbents will have sued it into the ground. $100 million verdicts are tough for an incumbent, but not a deal-breaker. $100 million verdicts are death sentences for anyone trying to start a competitor.

      The only day that we will kick their corporate corpses is if we get rid of stupid patents and actually enforce anti-trust regulations (note to the FCC: cable and satellite providers are no more competitors to ATT than pencils and markers are competitors to Bic). And I don't see that coming anytime soon.
    • Re: (Score:2, Insightful)

      by plague3106 (71849)
      Well, I hope Vonage continues, as I like their service. If it goes under though, the city telecom offers POTS over their shiny new fiber optic lines. The only reason I didn't get that with the TV and internet is because its more expensive than Vonage.
    • by MikeFM (12491) on Tuesday September 25, 2007 @08:57PM (#20751179) Homepage Journal
      I'd feel bad for Vonage except they already screwed me this year so I learned the hard way they were no less evil than any other phone company. I had been a customer of Vonage a year or so ago. I had several lines and had bought a couple decent phones to go with their service. I still have the boxes and receipts for these phones. I moved, switched jobs, etc and canceled my service until I'd gotten settled back in. When I go to turn my service back on I find out that they'd managed to leave one line subscribed. They swear up and down that there is no way I could have canceled my other lines without canceling that line unless I'd specified for that to happen. So if I want to get service back I'll have to pay the monthly fees and extra fees for that line before I can re-open my account. They never even sent me any kind of paper notice letting me know a line was still connected and going unpaid. Supposedly they emailed me the notice to my dead old work account and that I should have made sure they had an updated email address before I canceled my account. So fine, I argue with them for a while and get nowhere so I figure I'll just sign my wife up an account instead and worry about the fees later. No go - they lock the devices to individual users accounts. You can't switch them to another account even if you've previously disabled the phone from your account to add a different, more expensive, phone to your account. Okay this sucks - I check the packaging and none of the phones says anything about being locked to the vendor let alone to a specific account. The only note I have about this policy is a blurp that came with the original phone I got with my service and I'd assumed it'd only count for that phone as they gave me a discount off the price for signing up. The other phones I'd bought I couldn't get the discount because I was already a Vonage customer. Several hundred dollars down the drain with some nice VoIP phones I can no longer use at all and I chose not to open my wife a new account if I couldn't use the phones I'd already purchased.

      This is ass stupid behavior from a company. I had been a loyal customer who frequently told people how good their service was. Now I tell them how much Vonage sucks and to beware their dishonest business practicies. Brilliant move. Giving me a $100 credit for service I didn't use would have got my business back for years to come.
      • Re: (Score:3, Insightful)

        by karnal (22275)
        Supposedly they emailed me the notice to my dead old work account and that I should have made sure they had an updated email address before I canceled my account.

        First rule: Don't use work e-mail for personal bills. Of course, unless they were related....
        • by MikeFM (12491)
          They were related. I had a couple company lines and a couple personal lines all on one account. The email was hosted on my personal server but I killed it when I left as I wanted to stop getting angry complaints from customers (the new owner's poor customer service being one disagreement that led to my leaving).

          First rule: Don't be business partners with assholes. It screws lots of things up.
        • by pnutjam (523990)
          Something similar happened to me with packet8. I filed a dispute with the State Attorney General and even got a company lawyer to call me and indicate he would waive the charges when I reactivated. However, nobody I called to reactivate was ever aware of this and they wouldn't active me without the charges being paid. I did end up getting them to waive most of the charges by filing a dispute with the Better Business Bureau.

          I never paid the part they didn't waive and haven't heard anything about it i
      • That's all well and good, but it doesn't have any relevance in this case.
    • by Anonymous Coward on Tuesday September 25, 2007 @09:07PM (#20751241)

      .. they have destroyed VOIP as a threat, and they can go about their usual greedy, grasping ways. Sprint will raise a glass to Verizon and toast to their continued wealth.


      Gentlemen. . .to evil.

    • Re: (Score:2, Informative)

      If you want to make a difference and oppose this verdict, cancel any relationship you have with Sprint/Nextel and write them a letter explaining why you are boycotting them.
      If you believe in Vonage, show your support to them by subscribing.
      Anything else is just ignored.
  • Damn... (Score:5, Insightful)

    by Cervantes (612861) on Tuesday September 25, 2007 @07:11PM (#20750493) Journal
    Damn, I wish I'd remembered to patent "connecting phone calls over the internet" when I thought about it... oh, the first time I saw a microphone attached to a PC.
    Seriously, 8 random people who aren't smart enough to get out of jury duty are considered smart enough to understand the fine points of patent law and internet telephony? And this is enough to cripple a (relatively) small startup company? Can someone remind me what Sprint/Nextel did with these oh-so-valuable patents, and what Vonage did that cost them tens of millions of dollars? Besides not paying sprint tens of millions of dollars, that is.
    • Re:Damn... (Score:4, Insightful)

      by Anonymous Coward on Tuesday September 25, 2007 @07:21PM (#20750569)
      Well, speaking for myself, I flipped the telcos the bird (as hard as I could) and gave my dollars to Vonage instead for the past 3 years. Multiply that by however many other people who did the same, and it adds up to something.

      The most disgusting part of all of this is that the telcos let the little guys take all the risks, prove and market the technology to the public, and show that there is a viable market for VoIP phone service. They they realized that they could squeeze more money out of consumers than Vonage et.al. were, but the only way to do that was put them out of business. I can't help but wonder if this is what our Founding Fathers(TM) had in mind when they envisioned the patent system.

      Perhaps the most disheartening thing though, is the question: How many of the violated patents held by Sprint/Verizon are being infringed by the other under the blessing of cross licensing? I'd bet a big bag of money it's greater than zero.
      • The most disgusting part of all of this is that the telcos let the little guys take all the risks, prove and market the technology to the public, and show that there is a viable market for VoIP phone service. They they realized that they could squeeze more money out of consumers than Vonage et.al. were, but the only way to do that was put them out of business.

        The strategy you describe is known as "follow the follower." Imagine a sailing race where you can risk how you tack your sails--riskier ways may give
      • Well, speaking for myself, I flipped the telcos the bird (as hard as I could) and gave my dollars to Vonage instead for the past 3 years. Multiply that by however many other people who did the same, and it adds up to something.
        I hope they don't pay the $69.5 million to Sprint Nextel and $58 million to Verizon from your bird flipping dollars. That would be sad.
    • Re:Damn... (Score:5, Insightful)

      by Adambomb (118938) on Tuesday September 25, 2007 @07:34PM (#20750651) Journal

      who aren't smart enough to get out of jury duty
      Now if only we were all smart enough to realize that this might be a source of our problems.
      • Re: (Score:2, Interesting)

        by Anonymous Coward
        Its strange, as a fan of Law and Order, I've always wanted to serve on a jury (yes, I know the process, many friends and relatives have enlightened me as to how it sucks, but still). I had a juror summons recently and they wanted me on quite literally one of the 3 days per year that I absolutely cannot do it because of my job. I sent an e-mail to the address on the summons, received no response, didn't show up, and received no additional summons/notifications/letters/whatever. If it is that easy to dodg
      • There's two sides to the problem - one is that people try so hard to get out of jury duty and the other being that the remaining pool is shallower for it. Jury duty is a civic duty like voting, but of too few people do either then that leaves the respective systems up for more abuse than would otherwise happen.
        • I think that's less of a factor than the way the attorneys get to knock out anyone who has any education, and the juries aren't allowed to do their own research or call witnesses.
          • Juries also are also not allowed to be informed about the full extent of their rights and powers [wikipedia.org] under the law, which to me seems to defeat a major reason for having juries in the first place.
      • Re:Damn... (Score:4, Interesting)

        by drydirt (1161445) on Tuesday September 25, 2007 @09:04PM (#20751227)
        Now if only we were all smart enough to realize that this might be a source of our problems.

        On the other hand, realistically, how could eight randomly chosen citizens with no experience in the telecommunications field possibly come to an educated decision? Isn't a trial of this nature really just going to come down to which lawyer has the most winning personality (or the best ability to "dumb it down" in a way a layperson can understand?)

        I understand we as individuals are entitled to be tried by a jury of our peers, but when one multinational corporation is suing another are eight Kansas City residents really "peers?"

        And no, I don't have a better alternative to suggest, but something is clearly broken here.
        • Believe it or not I've never been called to be on a jury. But my boss was on a jury once, and he's not sure how he got on, other than both sides thought he'd be a decent foreman.

          Both sides interview potential jurors and both can decide a potential juror isn't acceptable (IOW, would be biased towards the OTHER SIDE). I think there is a limited pool so they can't just keep throwing people out until they get the real "winners".

          So, yeah, all people that get on a jury are (supposedly) hand picked to not
        • by ect5150 (700619)

          I understand we as individuals are entitled to be tried by a jury of our peers, but when one multinational corporation is suing another are eight Kansas City residents really "peers?"

          I tend to agree, however I find one flaw (at least in my own mind).

          I prefer the economists to run the economy. I would prefer the computer scientists to run the internet (and so on and so forth). But does that mean I want the lawyers to run the courts (i.e. - for only lawyers to sit on the jury?)? If not them? Then who? Random people? (which I'm not saying is any better...) I'm not sure what the best answer is here.

      • It's not this simple. Jury selection is made by lawyers who want jurors that they can manipulate. They don't want jurors that can think for themselves. So the court room becomes a big stage performing a farce, with half-assed actor-attorneys playing to the emotions of the jurors.
        • by Adambomb (118938)
          Out of curiosity, why are jury selections screened at all beyond ensuring they aren't sending the summons to a mental hospital, or someone with a conflict of interest, or something? How is that rationalized?

          I forgot about that fact, and never did understand it to begin with.
        • by Cervantes (612861)
          This should be modded up.
    • by bryan1945 (301828)
      "who aren't smart enough to get out of jury duty "

      If I knew what case I would be on (say something tech related), I would "dumb myself down" enough to get on that jury. Since you don't know what case you'll be on, I'm 0 for 5 on jury calls.

      My mom did put away a federal drug dealer, though! (She has a weird civil obligation thing) We bought her dinner. (Afterwards, she talked to one of the agents, and he told her there was a bunch of evidence against the guy that was dis-allowed" due to "technical points"
  • by timeOday (582209) on Tuesday September 25, 2007 @07:12PM (#20750505)
    From a customer viewpoint, I like Vonage because it's cheaper than a local phone, but I can't say I've seen any particular improvement in the service for the three years that I've been a customer. It works fine. There are some features, such as separate voicemail boxes for family members, which I've waited in vain for all along. Instead they introduced speech-to-text but are charging extra for it. Totally automated services like that ought to be free add-ons to differentiate themselves from "old-fashioned" telephone and nickle-and-diming cellphone companies. I'm not sure what their long-term plan is. Simply bridging between the Internet and POTS can't be all that hard.
    • by greenbird (859670) * on Tuesday September 25, 2007 @07:30PM (#20750623)

      I'm not sure what their long-term plan is. Simply bridging between the Internet and POTS can't be all that hard.

      It is when the only way you can implement it is with the approval of and huge payoffs to the industry oligarchs that currently control telecommunications and who's market VoIP is undermining.

    • by loid_void (740416) *
      I can say that the service I had with Vonage was awful. I switched over 3 phone lines and fax and all hell broke loose. Yes they have really neat features and great pricing. On one number I had 4 phones, it's suppose to handle 5, nope, didn't happen. They switched my phone numbers in 24 hours, but go and try and get them back, it took weeks (so much for the 30 day money back garauntee, it doesn't exist) Good luck to them, but they have a ways to go.
    • From a customer viewpoint, I like Vonage because it's cheaper than a local phone, but I can't say I've seen any particular improvement in the service for the three years that I've been a customer. It works fine.
      That's the point. If they offer the identical service as my old phone company for $20/month less (ie. free long distance), then it's totally worth it.
      Is Vonage cutting edge? No.
      Are they innovating? No.
      Can they save everybody at least $20/month on their phone bill? Yes.
  • by User 956 (568564) on Tuesday September 25, 2007 @07:13PM (#20750507) Homepage
    In addition to the damages, jurors awarded Sprint Nextel a 5 percent royalty from Vonage on future revenues.

    The correct legal strategy here is, change their name to an unpronounceable symbol, and force everyone to call them "the telecommunications company formerly known as Vonage".
  • Absurd (Score:5, Interesting)

    by cdn-programmer (468978) <terr AT terralogic DOT net> on Tuesday September 25, 2007 @07:27PM (#20750597)
    This is utterly absurd.

    In 1985 I worked out everything that was required to do this and in fact even went so far as to track down Dialog cards so I could interface a PC to a T1 line.

    There is NOTHING required that is worthy of a patent. NOTHING at all. This is all a totally obvious idea and relatively easy to implement. In fact it is so obvious that when I started working on the project I never even considered that patents would be available.

    I never finished that project. I was a single parent working at home and my kids at the time decided I should not be allowed to program. Alas.

    Now of course we have projects like Asterisk and its quite mature.

    So how does this ruling affect projects like Asterisk? (www.asterisk.org)

    Are we banned from plugging a hand held device that contains both a speaker and a microphone into a computer now? Or are we banned from connecting the computer to the telco switch, which BTW is a computer.

    Maybe we are banned from connecting a computer which is called a PC to a computer which is called a switch via a network which has been in common use for decades.

    To the fellow who points out that people who are too dumb to get out of jury duty are put in charge of million dollar technical decisions which they cannot possibly understand.... yes. You are 100% correct and you make an excellent post.

    Its clear that lawyers have managed to turn technical progress into a game of craps. IMHO this is something the public needs to be more aware of and somehow it would be nice if our pollies could be held accountable for the bad legislation they created. We really need to get patent business out of the computer business.
    • Re:Absurd (Score:5, Insightful)

      by Adambomb (118938) on Tuesday September 25, 2007 @07:42PM (#20750705) Journal

      To the fellow who points out that people who are too dumb to get out of jury duty are put in charge of million dollar technical decisions which they cannot possibly understand.... yes. You are 100% correct and you make an excellent post.
      Seriously though, why would ANYONE consider it smart to get out of jury duty when the decisions of the juries impacts case law like no other. Why is "Getting out of jury duty" considered smart? Yes, it is a hassle and there are opportunity costs involved, but think of the cost of ALL JURIES BEING RETARDED.

      In fact, i think we may be seeing that cost all over the friggan place at the moment.

      • by Arethan (223197)

        Seriously though, why would ANYONE consider it smart to get out of jury duty when the decisions of the juries impacts case law like no other. Why is "Getting out of jury duty" considered smart? Yes, it is a hassle and there are opportunity costs involved, but think of the cost of ALL JURIES BEING RETARDED.

        Because they don't actually tell you what the case is about until you hear the opening statements?

        Seriously. There are plenty of time wasting jury trials out there, and out of the whole lot of them I'd wag

        • We have an "Adversarial Justice System" which seems to mean that we have a prosecution/plaintiff, a defense, and 12d2.

          But it's because of the GP's point that a lot of otherwise smart people seem to think it's a good idea to avoid jury duty simply because it's a personal inconvenience. If you agree that taxes are necessary to being a functioning member of society, I fail to see how you could disagree that jury duty would also be necessary.
        • Because they don't actually tell you what the case is about until you hear the opening statements?

          My experience with jury duty (I live in DC, and go every two years) is that you learn what the case is about prior to selection during the voir dire process. That's one of the ways they figure out if you should be disqualified.

      • by Ungrounded Lightning (62228) on Tuesday September 25, 2007 @08:16PM (#20750935) Journal
        Seriously though, why would ANYONE consider it smart to get out of jury duty when the decisions of the juries impacts case law like no other. Why is "Getting out of jury duty" considered smart? Yes, it is a hassle and there are opportunity costs involved, but think of the cost of ALL JURIES BEING RETARDED.

        Because the jury selection process has been corrupted to the point that anyone with any background in the subject in question, or an engineering background in general, will be deliberately excluded from the selection.

        If I understand it correctly, this apparently started out to avoid having jury members bring into their deliberations any personal knowledge of information that is not in evidence (and thus was not subject to challenge by the litigating parties). But the net effect is to exclude exactly those people with the educational toolkit to make informed judgements on technical issues, rather than being led around by the rhetorical skills of the attorneys.

        People with technical backgrounds are, in fact, excluded from most trials. The ability to reason logically is seen as a liability by both prosecuting and defending attorneys.

        One result is that the panels finally selected are far from a statistical sample of the population - with a statistical bias that subverts the intent of the jury system - and thus justice - to an extreme degree.

        The other result is that going through jury selection is, for most technical people (along with anybody with a strong political position, knowledge of guns or crime, etc.), a massive waste of time. They will almost never be selected.

        = = = =

        By the way: You won't find the phrase "jury of his peers" in the US legal system. This is because we're all supposed to be peers before the law. Thus you have no case if you, as an engineer, object to being tried by a jury that systematically excludes engineers and consists exclusively of people who are retired or on welfare.
        • by MrDoh1 (906953) on Tuesday September 25, 2007 @09:20PM (#20751321) Journal
          I was the foreman on a murder trial a few years ago.

          After the trial, speaking with the defense and prosecutors, they both said they nearly excluded me, but both took a chance. They outright told me that they are afraid of people in technical, specifically IT related technical fields, serving on juries. They didn't really elaborate much but it was the general rule, not one just for this case.

          I did convey to them that I believed that was wrong thinking on thier parts.
      • by aztektum (170569)
        The only reason I did it was because my employer at the time wouldn't compensate me and the crappy state compensation would have made it hard to pay my bills come payday.
        • by Adambomb (118938)
          Well, touche on that one.

          I meant that more this general rule that seems to exist in the states that smart people get out of jury duty.
        • by GeckoX (259575)
          Is that legal?

          Seriously, how can it be legal to force a citizen to perform jury duty and as a result have that citizen lose income while performing their civil obligation?

          (Not an American so I'm genuinely curious...seems, well, potentially life destroying!)
      • No one would want to get out of jury duty if courts only tried pivotal, landmark cases. But the fact is, most trials are boring and very un-controversial as far as what the law states and how to interpret it.
        • No kidding. The only jury I ever got to be on was two lawyers suing each other over their share of a fee from a divorce case.
          • by Adambomb (118938)
            So let me understand whats being said. Its tedious, and its boring.

            and its essential.

            but we'll be not doing that?
      • by KKlaus (1012919)

        >>Why is "Getting out of jury duty" considered smart?

        The old Tragedy of the Commons. While our behavior in aggregate may lead us to ruin, as individuals we still find it better to dodge jury duty because we accrue all the benefit, and (generally) so little of the detriment.

        Here's a wikipedia link for those that want it: Tragedy of the Commons [wikipedia.org]

      • Re: (Score:3, Insightful)

        by nomadic (141991)
        Seriously though, why would ANYONE consider it smart to get out of jury duty when the decisions of the juries impacts case law like no other.

        Ehh...not really. Juries decide questions of fact. Questions of law are decided by judges. A jury's decision rarely has any sort of precedential effect at all.
        • Juries decide questions of fact. Questions of law are decided by judges.

          John Jay would disagree with that statement.
      • by dodobh (65811)
        One of those cases where the benefit to an individual is less than the benefit to the group. Also see the American lifestyle.
    • Re: (Score:3, Insightful)

      by truesaer (135079)
      Do slashdotters just play dumb, or do 90% of the people that read this site not even know what a patent is? Just because you figured out how to do VOIP at some point doesn't mean that there is no way to patent some piece of technology that could be used to do it.

      Vonage isn't in trouble for operating a VOIP service...tons of people do that, the cable company's phone offerings, skype, etc. I have no idea what patents they violated, but it would be a specific method or implementation...not the concept in gen

      • You mention, skype, which is a voip company, but there are using their own proprietary method. Vonage otoh, is using SIP (session initiation protocol) which is the standard for voip. I just don't see what patents vonage could be infringing on but no one else is.
      • by GeckoX (259575)
        Just because they haven't been sued doesn't mean the won't be sued.

        How long has Vonage been operating? Is it not more than a little suspect that a) The 'patent' holders are just sitting on these patents and b) They waited this long to sue over them.

        Without a doubt it's harassment and monopolistic practices, but practices which law in the US support.

        The system is very very broken and needs to be fixed.
    • You haven't actually used Asterisk, have you?

      It's not as easy to set up as it looks like on the box, even if you use trixbox.

      What you're really banned from doing is making enough money from VoIP to draw the attention of a TelCo. You can do whatever you want as long as you aren't popular.

      For example, did you hear about Ross Perot's murder rampage? I rest my case.
    • by mpe (36238)
      In 1985 I worked out everything that was required to do this and in fact even went so far as to track down Dialog cards so I could interface a PC to a T1 line.
      There is NOTHING required that is worthy of a patent. NOTHING at all. This is all a totally obvious idea and relatively easy to implement. In fact it is so obvious that when I started working on the project I never even considered that patents would be available.


      This appears to be the root of the problem, patents which should never have been grant
    • by mpapet (761907)
      So how does this ruling affect projects like Asterisk? (www.asterisk.org)

      Asterisk isn't technically a threat to the telcos. Yes, it can accept voip calls, but it's mostly a software version of a private branch exchange. Meaning, Pay the telco to terminate a couple lines into your office, then connect those lines to Asterisk, then connect a bunch of phones to asterisk.

      I've brought the issue up before with my two favorite VOIP-related projects and on both of them no one cares. Where it kills innovation is
  • by Secrity (742221) on Tuesday September 25, 2007 @07:39PM (#20750685)
    Interesting contradiction in a CNN article:

    "We are disappointed that the jury did not recognize that our technology differs from that of Sprint's patents," chief legal officer Sharon O'Leary said in a statement. ...

    "Vonage is working on a technology "workaround" to Sprint's patents similar to how it is addressing the Verizon patents."

    Why would it be working on work-arounds for patents that it is not infringing?
    • by AK Marc (707885)
      Why would it be working on work-arounds for patents that it is not infringing?

      Because if they lost (and they did) they would have to change how they did it, even if they still believe that they are not infringing on any patents. Have you ever heard the term, hedge your bets?
    • by cdrudge (68377)
      Because a jury just ruled that they were. They felt they weren't, and they probably will appeal the ruling, but in the mean time (and just in case), it still makes sense to determine a non-infringing way of doing the same thing.
    • by Dun Malg (230075) on Tuesday September 25, 2007 @09:10PM (#20751259) Homepage

      Why would it be working on work-arounds for patents that it is not infringing?
      Because it doesn't matter what Vonage thinks, nor what we think, nor what Mrs. O'Leary's cow thinks, but what the most skillful lawyer in the courtroom can make the sub-90 IQ jurors think.
  • Hurray (Score:5, Funny)

    by Scorchmon (305172) on Tuesday September 25, 2007 @07:47PM (#20750747)
    Well, on the bright side, we won't be having to hear anymore of that damn "Woohoo" song from their commercials.
    • Well, on the bright side, we won't be having to hear anymore of that damn "Woohoo" song from their commercials.
      Woohoo!
  • by Whuffo (1043790) on Tuesday September 25, 2007 @08:03PM (#20750863) Homepage Journal
    Here's another example of what's wrong in this country. Patents, which were intended to increase innovation and development have been bent into a weapon that corporations can use to destroy any new competition.

    We've got patents being issued on obvious / unpatentable ideas and they're being upheld by courts that appear to be working for the big corporations - maybe the judges are clueless or overworked, but decisions like this one don't make the legal system look good.

    Jointly, the current giant telecom companies hold patents on everything up to and including transmitting a voice over a wire. Any inventor that comes up with a better or cheaper way to provide voice telephony service will receive the same treatment that Vonage did.

  • by gillbates (106458) on Tuesday September 25, 2007 @08:07PM (#20750885) Homepage Journal

    said the decision 'feels like a death knell' for Vonage because future revenue will likely dry up, preventing the company from investing in better technology or improving customer service."

    Sharon, you must think we're a bunch of chumps. We didn't get to be big phone companies by being nice, you know. Better service and lower prices? Did you really think we'd let you get away with that little stunt?

    Why do you think we pushed patents in the first place? Monopolies have always been about better profits, and never about better customer service or value. Quite charming that someone out there actually believes in such antiquated notions, really.

    I believe, Sharon, you are just beginning to understand how a phone company is supposed to work. Better customer service? Hah! We're here to make a profit, and while your little charade was entertaining, it's high time you got on with being serious about being a phone company.

    I mean, honestly, when was the last time one of your customers was on hold for more than a half hour before finally giving up? And you call yourselves a phone company...

    Better technology? Are you serious? Why, that costs money, you know. Did you really believe our lawyers would let you get away with that?

    After all, just who do you think we are?

  • by ehinojosa (220524) on Tuesday September 25, 2007 @08:13PM (#20750921)
    It's really kind of ironic. Verizon bought out MCI, which was one of the first long distance companies that was able to circumvent the AT&T regulated monopoly. Their microwave towers were disrupting the existing market forces in much the same way that Vonage and VoIP in general has the potential to be. Now a company that only managed to get its start by being basically "a law firm with an antenna on the roof" is essentially using their army of lawyers to keep down their potential competitors.

    Funny how that works.
  • So, looking through google news about Vonage, none of the stories I found actually said which patents were ruled to have been infringed upon. Does anyone know what techniques and technologies Vonage used that Sprint and/or Verizon own patents on?
    • Re:Which patents (Score:4, Informative)

      by greenbird (859670) * on Tuesday September 25, 2007 @08:46PM (#20751123)

      Does anyone know what techniques and technologies Vonage used that Sprint and/or Verizon own patents on?

      A ZDNet analysis [zdnet.com] of the disputed Verizon patents 6,104,711 [uspto.gov], 6,282,574 [uspto.gov] and 6,359,880 [uspto.gov].

      I haven't been able to find a list of the Sprint patents yet.

    • by greenbird (859670) *

      Does anyone know what techniques and technologies Vonage used that Sprint and/or Verizon own patents on?

      Here's an ars technica analysis [arstechnica.com] of the three disputed Verizon patents.

      This blog [blogspot.com] references 2 Sprint patents 6,373,930 [uspto.gov] and 6,731,735 [uspto.gov] but I can't seem to find any references listing the patents in the Sprint lawsuit.

  • Just hit customers with a US$1.00 increment in service charges. Problem solved. Period.
  • Otherwise, innovation might be stifled.
  • by BlueParrot (965239) on Tuesday September 25, 2007 @08:34PM (#20751041)
    It is increasingly starting to look like the US system will grind to a halt. The real question is what it will take for competition from abroad to force a reform. My guess is that sooner or latter the US economy will take such a hit that the rest of the world will no longer be dependant upon it. When that happens Black Tuesday will look like statistical noise in comparison.
  • by YetAnotherBob (988800) on Tuesday September 25, 2007 @09:15PM (#20751289)
    I see from the article that the patent system is working as intended.

    Patents really exist to slow the pace of innovation down to the point where the legal system can deal with it. They are also intended to protect the large economic organizations from threats by smaller corporations that may not be able or care to carry the loads for the system that the larger entities do. (However inefficiently.)

    That patents promote innovation is a propaganda line that has never been true. Patents were created as a mechanism to prevent the rapid spread of a technology that threatened a royal monopoly in the late 1600s. They have always been no more than a way to slow down or stop change in the economy.

    Preventing other people from using new ideas is all patents allow anyway. To really use a patent, you have to have a large amount of money to spend on lawyers. The results are usually chaotic, with the normal result being that the side with the most money wins. Often by bankrupting the other side with legal bills. Private patent holders are even told this in court, with the judge agreeing. There are exceptions, mostly when the patent owner is a law firm (Patent Troll). Even then the systems works, as the Trolls increase the cost of doing anything in a new way to the point where only truly outstanding ideas are ever doable.

    The problem here is that this crowd (Slashdotters generally) doesn't understand the real reasons for the system. They are falling for the propaganda reasons, which are obviously not working. If you understand the real reasons, the system is working just fine. Those very public reasons of 'promoting innovation' are only out there to dupe the masses, and allow for the usual corruption at the top to continue.

    Next thing I know, you will be claiming that drug patents reduce the cost of drugs. I guess P.T. was right, there really is one born every minute.
  • Let me start by saying i know very little about the specifics of this case. I also believe that there is a time and place for some sort of patent system (whether the current system is flawed, I don't know). Alot of the posts have critized the patents for stiffling progress. I'm wondering if these responses have been gut reactions reactions, or if these posters know something i do not. Does anyone know which patents are in question? Of those people who do, does anyone have the technical and legal expert
  • I like Vonage because their service lets me use a non-local number. In this case, I live on one side of the country, while my gf is on the outer. Since I've been scoping jobs in her area, it's nice to have a number that's local to that area for interested employers to call.
  • Vonage customer service sucks.

    I never used the customer service until I wanted to get out of the program. The process for doing that was horrible. We ended up in a dispute over the last month's charge. They said I owed it because even though I didn't use the service, I hadn't canceled in time, I said I tried to cancel but they screwed up and I wasn't going to pay them a single penny more.

    Eventually they backed down, but I would never recommend Vonage to anyone.

    It cost them way more to fight with me than
  • by Fantastic Lad (198284) on Wednesday September 26, 2007 @03:11AM (#20752905)
    When it all comes down to it, I'm not saving as much as I should be.

    Heck, getting a naked DSL connection from the local telco provider in my region (Canada) means I also get hit with a $10 charge, (penalty) because I'm not also subscribing to their phone service. What kind of company bills you for NOT using their service? It's damned criminal, but there's precious little which can be done about it. I liked it waaaay back when Bell was a government controlled monopoly. When they pulled greedy tactics, the public was quick to slam them down. It was rare for me to ever see a phone bill over $25 a month back then.

    Then the whole show was deregulated and competition opened up and everybody cheered because they were ignorant. (People! Oh lordy, but they can be sooooo dumb!) I was one of the only people yelling, "Don't you see? It's a trap!" --Before I finally switched to VOIP, $100 phone bills were not uncommon. And that didn't include ISP charges.

    I love socialism. Competition is a great idea, but it doesn't work at the huge corporate level, because the big players are too few in number, they can cleverly jack up prices and nobody can sick the government on them to control their rampant greed.

    If people were less easily fast-talked by corporate America, if our governing bodies actually served the people who pay for it, then this could be a really beautiful world.

    The problem isn't just greed, it's ignorance.

    Knowledge protects.


    -FL

  • So- is it safe to use the voice-over-air interface I've been using for some time now? It uses a frequency range that the FCC hasn't licensed (yet). I'm also starting to wonder if the USPS is going to run into trouble for using packages- _awfully_ close to packets ...
  • Sprint is based in Kansas city so I don't see how jurors from KC can be objective.
  • We need some Compulsory Licensing here at more reasonable rates. Unless the Telcos can show that they're using those patents in a Directly Competing business, they should be required to license these patents to Vonage At The Best Rate (lowest) that they have licensed them to anyone else. Otherwise they're just using them to avoid competition, which is completely Anti-Consumer. The Patent System is supposed to Improve life for its citizens, not protect entrenched monopolies from new technology!

God doesn't play dice. -- Albert Einstein

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