backtop

Print 25 comment(s) - last by karanda12.. on Jul 14 at 1:16 AM
Citigroup is Vonage's underwriter

It appears as though Vonage is in a more problematic situation than earlier reported. It now appears as though Citigroup, the company that managed Vonage's IPO, has declared a state of "hold" on trading Vonage's shares. The problem with being given a "hold" rating however, is it's usually reserved for a company that's in a questionable state of  financial direction with the market. According to the report, Citigroup is telling the market that it's just not worth it to buy more Vonage shares at this time.

Since its IPO, Vonage's stock has taken a major stumble, dropping from a price of $17 to a dismal $8.60. Many investors who purchased Vonage's shares ended up filing lawsuits against the company for not properly disclosing certain risks and certain details about its services and direction. Some have even threatened Vonage not to pay for the purchase of its shares.

Analysts are concerned over the competition that surrounds Vonage, citing that companies like AT&T and Comcast are coming out with more attractive VoIP and data packages. After its IPO, many investors began worrying about Vonage's services and offerings, saying that the company didn't really bring anything special to the table. Vonage has continued to take a beating in the market ever since. Vonage has also loss a considerable amount of money in profits, which quadrupled in 2005 from 2004 to $261 million. Vonage's net profit margin currently stands at -82.47%.

Vonage is currently being served several suits from Verizon over patent infringement.

Comments     Threshold


This article is over a month old, voting and posting comments is disabled
Vonage isn't that bad
By FujiT on 7/4/2006 6:42:23 PM , Rating: 5
Ok for the person that complained about the lack of number porting, it's not really our fault. When we port numbers, it depends a lot on different people, and that involves delays. Phone companies don't always work at the fastest speeds.

We are expanding. I'll leave it at that. The advantage that we have over verizon and cablevision is the fact that we use othe r people's services (broadband) to provide our VoIP services. So we can in theory expand anywhere we want to.

Also, you'd be supprised at how many people we hire. I get mutliple emails daily about more people getting hired. The amount of laptops in the "new hire" cube is a testament to the growth of Vonage.

I recently saw the new vonage softphone and i must say I was impressed. You plug it into a USB port and the software pops up. So I don't really agree with the lack of innovation.




RE: Vonage isn't that bad
By Targon on 7/4/2006 7:49:35 PM , Rating: 2
FujiT,
A problem that Vonage has is that the advertising doesn't focus on what Vonage offers that other companies don't. The Find Me feature and being able to take your number with you when you move are just two features that I don't see other providers offering. There are other things as well, but the people who decide not to focus on what makes Vonage different in the advertisements need to be slapped.

One thing Vonage could also do to help isolate potential issues is to have one of those bandwidth testing programs available for download from the Vonage site just to verify how much bandwidth is available by customers and to suggest the proper quality settings under the Vonage control panel for best voice quality.


RE: Vonage isn't that bad
By Heatlesssun on 7/4/2006 8:22:22 PM , Rating: 2
Those are nice features, but when I went with digital phone from TimeWarner, my main concern was reliability and my data connection not being impacted.

From what I understand, and I might be wrong, but I've tested transmission speeds while on the phone, TimeWarner's phone service doesn't actually use your cable modem's data bandwidth. In fact, with the new digital phone/cable modem device, my overall bandwidth seems to have increaed 20%. So no data bandwidth lost and even more of it to boot.

I really thought about going the Vonage route, it is cheaper than TimeWarner's phone service, but the TW service has been seemless, it wouldn't even know that I as using a digital phone if I didn't know. The service has worked perfectly, and even works with faxing well.

Vonage is just in the wrong business and the wrong time. The competition is extreamly stiff, and the services, at least what I've gotten from TW has been excellent.


RE: Vonage isn't that bad
By Kuroyama on 7/5/2006 2:07:42 AM , Rating: 2
Is Time Warner VoIP? My understanding is that Digital phone is just a normal phone connection being sent over an unused cable channel, and is not packet based like VoIP.


RE: Vonage isn't that bad
By FujiT on 7/4/2006 10:36:36 PM , Rating: 3
RE: Vonage isn't that bad
By rushfan2006 on 7/5/2006 9:08:19 AM , Rating: 2
I agree with that. Its not just Vonage though, the problem with just talking about price erks me to no end with any company's product...unless the product is so well "mundane" to me that it doesn't matter. Like napkins -- all I care about napkins is how cheap they are, its not like I'm gonna wipe my arse with them or something after all.

But other products -- if the only thing a company can say is "well we are cheaper"...then that makes me say "yeah...what else do you offer?".

The one thing that Vonage (and other Voip, actually phone companies too) don't understand is that its a PAIN IN THE ARSE to do the phone company shuffle. You have to usually wait on hold for 20-40 minutes before you even speak to anyone, then you have to listen to their "speech" about how great they are (another thing I love about companies...the ego trip they have when a customer is leaving "but wait sir we are the best company in the world". Um get a clue obviously you are NOT the best company in the world to the customer's POV if they are calling to cancel their service. DUH!).....anyway on and on, then you have hope it doesn't take forever and a day for the new phone service to start, then if the new company sucks you have to go through all this crap again to get switch back, normally your fist bill is always screwed up...

Nah...just too much hassle to save a measely $10 a month for me.

Yep..I'm only paying $31 a month to Verizon, and its much more reliable and great sound quality too then an Internet dependent service. True verizon's service leaves MUCH MUCH MUCH to be desired, but I have a personal hatred and loathing for all Cable, Telecommunications, Car Salesmen and Law firms to begin with. ;)

nuff said


Vonage sucks...
By bobsmith1492 on 7/4/2006 5:47:51 PM , Rating: 1
My parents got Vonage to replace their land line...

First, they said we could keep the same phone number. Then, when they actually bought it, they couldn't even get a phone number in the same area code.... !! Anyway, the actual phone ended up rarely working anyway, and since they had a brand new number local to Arkansas (we live in MI), no one really used it, being new and long-distance, so it was really the most worthless thing ever; the internet wasn't even available when you were on the phone. They swapped it out and now have cell phones, one of which has the same number as the old land line. Useless Vonage...




RE: Vonage sucks...
By rushfan2006 on 7/5/2006 8:57:02 AM , Rating: 2
quote:
the internet wasn't even available when you were on the phone.


Wow. If I'm understanding you right -- that your Internet couldn't be used at the same time as you were using the phone, but you could when you were not using the phone. That's very odd indeed, as that is one of the whole points to VoIP. I'm no expert on IP, but I have configured VoIP phone systems enoguh to know that the bandwidth for the actual voice portion really isn't that significant. The packets prioritize voice over data as well -- so really they shouldn't conflict at all in a well designed and configured system.

I'd say your Internet must suck -- if it wasn't for the fact that even a 1mb connection is more than enough for sufficient phone and data *at the same time* transmission.



RE: Vonage sucks...
By RMTimeKill on 7/5/2006 10:27:50 AM , Rating: 2
I am on a 5MB CableModem, and if I am downloading a file while on the phone (using Vonage) the person on the other end can hardly hear me, due to cell phone like "cut outs". Works great if your not downloading or using any bandwidth, but kind of defeats the purpose of having high bandwidth... (at least from the "not tieing up the phone line" stand point)


RE: Vonage sucks...
By Dulanic on 7/5/2006 9:33:50 AM , Rating: 2
quote:
First, they said we could keep the same phone number. Then, when they actually bought it, they couldn't even get a phone number in the same area code.... !! Anyway, the actual phone ended up rarely working anyway, and since they had a brand new number local to Arkansas (we live in MI), no one really used it, being new and long-distance, so it was really the most worthless thing ever; the internet wasn't even available when you were on the phone. They swapped it out and now have cell phones, one of which has the same number as the old land line. Useless Vonage...


Useless you... you didn't check what area codes they have before hand? Of course they couldn't keep their phone # if they don't have that area code available! That's purely your fault. And as someone else said... must have one crappy connection. I use Vonage and I can tell you I have never had a single issue with my cable connection.


RE: Vonage sucks...
By redeyedfly on 7/5/2006 3:07:23 PM , Rating: 2
quote:
the internet wasn't even available when you were on the phone.


the internet didn't work when you were on the phone? how is that? who setup their network? obviously someone that knows very little about networking. Its called an "adapater", which requires a broad band always on internet connection. you can use a dail up connection for voip, but then again its arkansas.

I went w/ vonage, kept my old number and use it all the time. It was the easiest thing I ever did. I never have any problems. Free long distance, 24.99 a month, its great! I am not going to throw my money away and conform to the monoply.


-82.47%
By Atrye4444 on 7/4/2006 2:52:04 PM , Rating: 2
quote:
Vonage's net profit margin currently stands at -82.47%.


Wow! It's been clear that Vonage is in big trouble lately, but I had no idea it was so bad.




RE: -82.47%
By Targon on 7/4/2006 7:56:42 PM , Rating: 2
A start-up that puts most of it's income into hardware for expanding their services tends to run at a huge loss. It's only once customer growth has slowed that a company starts to show a profit(if it's well run).

Remember, when the telephone was new, the governments around the world invested a LOT of money to get phone service into every home. As a result, you see the tax surcharges on phone bills and probably always will.

The Internet may have started with government money, but do you honestly think that the ISPs out there today received government money when they were expanding? How about the cable companies? The reason VOIP isn't and should not be subject to these surcharges is because the government has done NOTHING to assist in providing the service, and in many cases have hindered it.


RE: -82.47%
By Kuroyama on 7/5/2006 2:04:51 AM , Rating: 2
A start-up that puts most of it's income into hardware

I doubt it, I think most of the money goes into the stupid TV commercials. Yeah, everyone remembers them because they're so idiotic, but they have almost no substance, and as other people have noted it tells us little about what's special about Vonage other than cost.

Also, this sounds like the same thing we heard during the dot-com boom. "We'll make money later but have to get customers now". Other than perhaps Amazon, it didn't work then and won't work now.


RE: -82.47%
By matthewfoley on 7/5/2006 11:57:39 AM , Rating: 2
Everytime I hear one of those stupid wooohoo, woohooohoo commercials come on (which is quite often) I have to mute it...drives me absolutely crazy.


Hold -
By Lifted on 7/4/2006 3:41:27 PM , Rating: 3
"The problem with this state however, is it's usually reserved for a company that's in significant market trouble with investors."

Then what do you consider sell and strong sell?

Hold is not a state, it's a rating. It means exactly what it says it means, don't buy, don't sell, just hold onto the stock. That is quite far from the description you have given.




RE: Hold -
By Tuan Nguyen on 7/4/2006 5:00:53 PM , Rating: 2
Reworded for clarity.


Tuan.


Citi may end up in trouble because of this...
By Targon on 7/4/06, Rating: 0
By masher2 (blog) on 7/5/2006 9:43:41 AM , Rating: 4
> it's possible they are being paid off by others...I don't know all the securities laws when it comes to this sort of thing..."

Translation: I'm clueless, but always willing to believe in a good conspiracy theory.


Vonage is great FCC screwed them over!
By Randalllind on 7/5/2006 3:27:45 PM , Rating: 2
They had to spend Millions to phone compines to get Enhanced 911 setup. FCC at the time told VOIP they could not add members until E911 was offer in the area they wish to expand.

Now it seem everyone wants to add tax on to vonage so what a company suppose to do? The government wants to kill voip cause they miss people paying $100 phone bills.

I think Vonage rocks. Only issue I had was I wanted my number switched and had trouble getting it faxed to them. Then I got a call saying it was recieved and then another call sayin they never recieved it. So I cancle the switch and took an assign #.

As far as service goes I don't even thing about it being a voip. It is as clear as any landline phone I use.




By The Boston Dangler on 7/6/2006 12:59:28 AM , Rating: 2
"They had to spend Millions to phone compines to get Enhanced 911 setup. FCC at the time told VOIP they could not add members until E911 was offer in the area they wish to expand."

So, your complaint is based on a regulatory agency mandating a "service provider" (I use the term loosely) provide its customers, the general public, with emergency service that saves 1000's of lives a year?

p.s. Vonage DOES NOT have E911. It has a "substitute".


Vonage
By Squidward on 7/4/2006 2:30:19 PM , Rating: 3
Since its IPO, Vonage's stuck has taken a major stumble

Should be stock but I could see how that typo was made considering Vonage's stocks are stuck. :)

Umm, for those of you with Vonage stock all I can say is bail out while you can. I don't see them rebounding.




Woo hoo, woo hoo hoo!
By Houdani on 7/4/2006 5:19:10 PM , Rating: 2
Yay! Soon I will never have to hear their horrible theme music any more. Happy day indeed!

Seriously, I change the channel every time one of their commercials comes on -- I just hate their "Woo hoo, woo hoo hoo" that much. I know it's purely an emotional decision, but I vowed never to give them my business because of how annoying their commercials are.




Predicted
By Trisped on 7/5/2006 1:01:50 PM , Rating: 2
If you read through the original articles where DailyTech reported the up coming stock release you may notice that 50% of the posters were pointing out good reasons why Vonage stock was not going to do well. Sure, when other companies start publicly trading they make a lot of money, but Vonage stock was over priced to begin with (analysts said it should be valued closer to $15 then $17). They also had a bad out look, with other companies entering the market and the lack of earnings.

I feel a little sorry for the investors that lost so much money, but a person should really check things out before investing their cash into something so dangerous.




I think...
By karanda12 on 7/14/2006 1:16:10 AM , Rating: 2
...it's the perfect time to take an advantage of a company in trouble. Just look at the discounts they are making to attract more customers http://bulgle.com/L/L/1vng.php
It's insane...




"We’re Apple. We don’t wear suits. We don’t even own suits." -- Apple CEO Steve Jobs











botimage
Copyright 2012 DailyTech LLC. - RSS Feed | Advertise | About Us | Ethics | FAQ | Terms, Conditions & Privacy Information | Kristopher Kubicki