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The End for Vonage? 296

TheRealSCA writes "The latest in Verizon vs. Vonage is in. The judge has basically stopped Vonage from accepting new customers. From the article: 'A judge issued an injunction Friday that effectively bars Internet phone carrier Vonage from signing up new customers as punishment for infringing on patents held by Verizon. Vonage's lawyers said the compromise injunction posted by U.S District Judge Hilton is almost as devastating as an injunction that would have affected Vonage's 2.2 million existing customers. "It's the difference of cutting off oxygen as opposed to the bullet in the head," Vonage lawyer Roger Warin said.'"
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The End for Vonage?

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  • What? (Score:4, Interesting)

    by ivan256 ( 17499 ) on Friday April 06, 2007 @01:18PM (#18636263)
    So you think this wouldn't have happened if Vonage hadn't pursued patents?

    Let me add a dose of reality to your delusion. They simply would have been sued out of business sooner.
  • Re:Whatever... (Score:3, Interesting)

    by faedle ( 114018 ) on Friday April 06, 2007 @01:28PM (#18636409) Homepage Journal
    That's the problem. Vonage, like most young companies, is only solvent as long as they start taking in new customers. You slam the brakes on new signups, the whole house of cards can collapse.

    I give Vonage six weeks. Hell, if they can't get this injunction lifted, and the don't find a way to work around it and sign up new customers, they may have six hours. We'll see how Wall Street responds to this news.
  • Some thoughts (Score:3, Interesting)

    by Anonymous Coward on Friday April 06, 2007 @01:30PM (#18636433)
    Keep in mind that the Markman hearing (to decide what the claim actually covers) adoption of verizon's construction of all the claims means that all of the patents read so broad that things like BIND and SIP infringe -- Add to that court irregularities: no patent case expertise and instead of days, there was only a 30 minute per side argument per side for 48 claims over 7 patents -- and there's a pretty strong case for appeal.

  • by werfele ( 611119 ) on Friday April 06, 2007 @01:37PM (#18636547)

    Vonage lived by the sword -- they themselves believed in patents.
    I don't know about Vonage specifically, but it's unwarranted to assume that because they applied for patents that they believed in patents. Those patents might have been intended as (apparently inadequate) defensive patents [].
  • Re:What? (Score:4, Interesting)

    by ivan256 ( 17499 ) on Friday April 06, 2007 @01:41PM (#18636591)
    Say you walk into a room. There's a sword leaning against the wall next to the threshold and a fully armored knight charging you with his sword held high. Do you pick up the sword and parry, or do you simply make peace with your last few seconds of life?

    It is clear to me that the parent considers defensive patents the same as using patents in a predatory manner. He's wrong.
  • really? (Score:2, Interesting)

    by warrior_s ( 881715 ) <> on Friday April 06, 2007 @01:53PM (#18636759) Homepage Journal
    FTA: "The judge has basically stopped Vonage from accepting new customers."

    But I can still go to their website and sign-up []
  • by faedle ( 114018 ) on Friday April 06, 2007 @01:57PM (#18636819) Homepage Journal
    RIM was sideswiped by (arguably) a patent troll who had no tangible product, no customers, and nobody had ever heard of.

    This is a lawsuit brought by a well-funded telephone company (the largest LEC in the United States, and one of the largest telecom companies on the planet). Wall Street will respond negatively to this news once it starts circulating.

    The news is just now hitting the wire, and Vonage stock has already taken a 10% beating. Once the announcements are made by Vonage and Verizon later this afternoon, expect the stock to be in penny-stock territory range on Monday once trading ends.

    That does not bode well for Vonage as a company.

    Verizon fully intends, through the courts, to shut Vonage down. It appears, effectively, they have.

    Next week's news story: Verizon acquires a majority stake in Vonage as a "settlement" to the lawsuit, and begins "transitioning Vonage customers to Verizon's VoIP offering". Six months down the road, Vonage will quietly cease operations, after Verizon uses the leverage of their stock position to shutter the company after all customers have been moved off Vonage's revenue column.
  • by UncleTogie ( 1004853 ) * on Friday April 06, 2007 @01:59PM (#18636859) Homepage Journal
    You've never known someone to avoid a company on principle? I do it all the time and ENJOY voting with my wallet....

    ...but then again I've been known to vote to throw elections, too...
  • by BLKMGK ( 34057 ) <> on Friday April 06, 2007 @02:14PM (#18637101) Homepage Journal
    No the parent poster was right - scratch them off the list. I could care less what they might be willing to give me in the way of say cellualr service - it's a poison pill that will bite back first chance it gets. Vonage, of which I'm a customer, competed and is being destroyed by what appears to be an overly broad patent and a judge out of control. If the folks who have started this think they will ever regain my business they can think again about it - won't happen no matter what's offered.
  • Re:Secret $5 plan? (Score:4, Interesting)

    by TheMCP ( 121589 ) on Friday April 06, 2007 @02:48PM (#18637659) Homepage
    If you get Gizmo Project [] and Grand Central [], and configure the latter to use the former, you can get unlimited inbound calls for free.

    I've been very happy with my Vonage service, and I hope they'll win this one in court eventually. If they don't, I'll reconfigure my Vonage hardware to use another SIP provider (like Gizmo Project): I'll switch back to TPC when heck freezes over.
  • by Yaztromo ( 655250 ) on Friday April 06, 2007 @03:01PM (#18637899) Homepage Journal

    As a Canadian Vonage user, my interest in this case is going to be how it affects me -- but nobody seems to be talking about what might happen to the Canadian (or UK) subsidiaries should Vonage US go down.

    It appears that Vonage Canada (and presumably UK) is a wholly-owned, seperate company, and isn't directly constrained by the patent suit (as Verizon has no Canadian presence or patents). However, it is my understanding that Vonage Canada relies pretty heavily on the Vonage US network for call routing (although it is also my understanding that it has been gaining a bit more independence in the past year).

    So what happens if Vonage US goes into receivership? Presumably holdings like Vonage Canada and Vonage UK will go on sale. I suspect Vonage Canada's call quality might suffer if they don't put contingency plans in place now, but that if they can stave off the loss of customers due to the US network folding, it could potentially survive (in which case, the 4 Vonage lines I have in my home, and the Vonage lines family and friends have thanks to my recommendation could keep working). But then again, if Vonage Canada isn't all that profitable (I have no idea if they are or not), they could fold up as well.

    For now I'm waiting it out, but if anyone has any better info on what could be expected for the Canadian and UK subsidiaries, I'd certainly be interested in learning more.


  • by Yaztromo ( 655250 ) on Friday April 06, 2007 @06:27PM (#18640863) Homepage Journal

    I'm a Vonage Canada customer as well and I am just holding my breath hoping this gets sorted out. I have been a Vonage customer since it first broke into the Canadian market and I will sorely hate to lose the service. One of the best features is the virtual phone numbers (I have 2, one in Arizona and one elsewhere in Canada). There don't seem to be any VoIP competitors in Canada that offer the same features as Vonage so switching to something else is going to be very difficult.

    I'm in a similar boat. To top things off, now that we have number portability for cell phones here in Canada, I just applied last week to have my cell number transferred to Vonage as my new main number, with my old Vonage number staying as a Virtual number (which is important to me, as when I moved to BC I kept my cell phone on my old Toronto number -- and besides which, I've been realizing more and more lately what a terrible rip-off cell service is here in Canada, and I can't wait to be totally rid of it (I pay $50 a month for what is supposed to be a $25 a month plan, and use it about 15 minutes per month because I can't get any signal in the two places I spend the most time -- the office and home)).

    I'm not a high-volume phone user. I don't want to spend a ton of money for phone service (and right now between Vonage and Fido I'm paying nearly $90 a month). I'm going to halve my phone bill going the all-Vonage route and getting rid of my cell phone -- and I'll still have three phone lines (I'm a Vonage Softphone user) in two different area codes. I have no idea what I'm going to do if they go under -- I'm not going to be able to replace their services for a reasonable price if they do.


Karl's version of Parkinson's Law: Work expands to exceed the time alloted it.