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Vonage can hear Verizon now after losing infringement lawsuit

A suit filed in June by Verizon Communications against Vonage made its way to court last week.  Verizon claimed that Vonage infringed on several patents including the technology Vonage used to connect phones from its Internet Protocol service to traditional phone networks.

Vonage claims it had never violated any of Verizon patents, saying that it has been using third party technology that is already the standard throughout the industry.  One of the such is the voice gateways from Cisco Systems, to route voice traffic over the internet.

The final decision made by a federal judge stated that Vonage Holdings Corp. must pay out $58 million in damages to Verizon along with 5.5% future revenues royalty for any continuing infringements, according to a press release.  The decision came from the U.S. District Court of the Eastern District of Virginia, filing the infringements of three of the five patents under consideration.

The number of Vonage subscribers dropped from 256,000 from the second quarter of last year to 204,591 in the third quarter and then to 166,000 in the fourth with is Q4 loss from $72 million last year to $65 million this year.  Company executives say this is partly due to the bust of the company's commercials.  The next step is to replace the commercials and design infomercials that use customer testimonials to promote the service.

The pull themselves out of the hole, Vonage formed an agreement early this year with Earthlink to begin reselling wireless broadband in Earthlink’s covered cities.  To add to diversity of the companies marketing, Vonage executives have also mentions the company's stake in dual-mode handsets that will allow VoIP along with cell phone calls.

"We are confident in Vonage's future health, growth prospects and longevity," said Jeffrey R. Citron, Vonage's chairman and chief strategist.   Vonage has announced that it is not going out of business and its service will not be disrupted.

Currently, Judge Claude Hilton issued a permanent injunction against Vonage.  The reason behind the injunction is that the judge believes that providing monetary damages "does not prevent continued erosion of the client base of the plaintiff."  The injunction will not formally be entered for another two weeks, said Hilton.

Vonage is requesting to stay the injunction of either 120 days or until its appeal is heard.



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Why I switched from Vonage to SunRocket.
By Mitch101 on 3/26/2007 12:18:38 PM , Rating: 2
Problems I had with Vonage.
1- Paid for fax service that never worked. Wasted money.
2- Tivo would not work over Vonage. I didnt expect it to but I was paying for the fax service and it wouldnt even work on that.
3- Answering service had many bugs the biggest one when when I was looking for work it would have messages I could not retrieve. This happened a lot. A few hours later to several days later I could access those messages. Not good when looking for a job.
4- Outages. Man in the North Carolina area at least twice a month it would go out for several hours.

We looked at it as being a basic phone line and with that we decided to try SunRocket.
1- Tivo can make its daily call on my Sunrocket Device.
2- I can fax with SunRocket and it doesnt cost me extra.
3- Answering service has been much better. At first we had a few saying there was a message when their wasnt but that hasnt been a problem in about a year now.
4- Any outages have been the result of power outages and my cable provider being switched from Adelphia to RoadRunner/Time Warner.

Its not to say that we never have a problem with SunRocket but actually I can say SunRocket in the Charlotte, NC area has been excellent and significantly better than Vonage. I would assume that your area may vary from each of the providers.




By Mitch101 on 3/26/2007 12:25:53 PM , Rating: 2
Oh I almost forgot about the false busy signals I used to get on Vonage. Just read about that in another users post. Also a few 800 numbers it would tell me I could not call that number but I dont recall the message it would say.

Sunrocket also cost me $8.33 a month for unlimited. Every now and then they have a 2 year sign up for $199.00.


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