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Vonage Loses Appeal; Verizon Owed $120 Million
Billosaur writes "Things do not look good for Vonage. Yesterday, they lost their request for reconsideration of their settlement with Verizon. This means Vonage owes Verizon $120 million to end the patent lawsuit filed against them. The costs associated with defending the case have cut into Vonage's bottom line, and despite attempts to cut costs by laying off 10% of their workforce, they may be unable to make a payment against their debt come December. According to the settlement, Vonage will pay $117.5 million to Verizon and another $2.5 million dollars to charity. Vonage's shares have dropped 87% since their IPO, now hovering around $1.50 per share."
So will I be able to buy my Vonage phone#, that they've refused to let me port to my own SIP server, when they have the firesale? Or will they sell me to Verizon to pay for their patent infringement?
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make install -not war
Slashdot foaming at the mouth in 3..2..1 GO!
as Vonage was going IPO it would come burning down like a flamin' meteorite.
Presumably their TV campaign will dry up?
It just goes to show this kind of patent madness hurts everyone. this horse shit needs to end.
If you mod me down, I will become more powerful than you can imagine....
for some lessons in how to run away with money. Go to a judge, declare that you want to restructure (Chapter 12, right), this stops all pending litigation, now proceed to spend all of the company's money, and laugh all the way to the bank.
What patent did Vonage infringe upon?
It didn't hurt Verizon.
I am sure they would disagree that it needs to end.
And they have a much louder voice than you.
Dibs on patenting the wheel.
God spoke to me.
Judge Greene's breakup of AT&T into the RBOCs mean we now have less RBOCs, and if they have patents, they can stifle any competition they want. Is this a new way around the Sherman Anti-Trust Act???
All that's left are a handful of tiny regionals, and Verizon, AT&T, and QWest. MCI is dead and gone... and buying up patents (or even 'cleanly' filing them) means that these companies can effectively shutout the competition.
Not good.
---- Teach Peace. It's Cheaper Than War.
This is not good. I've been using Vonage for years. They provide decent service at good rates, specially for international calls, which I use a lot. What is the option now here in North Carolina? Time Warner? Bellsouth? Their service sucks and they are more expensive. Customer support is worse than non-existent. How is the current patent system serving the people? I understand free enterprise and all that, but lately just feel we the people get always screwed. Is this just me?
Please add number porting to Grand Central so I don't lose my home number when Vonage goes under.
K thx bye.
you know if verizon was competitive about it like all you bitch about and cut their prices to put vonage at a disadvantage you'd all be bitching that they're throwing their weight around as a monopoly. verizon can't win in the eyes of you people. vonage should burn.
I've really only heard that they are infringing on 'some patents' - anyone have a good synopsis of why Vonage is getting successfully sued out of business?
They've been averaging $2+change for the past month.
I haven't seen a great explanation of what the patents were that were violated but I'm guessing it's a software type patent that's overly broad and covers all VoIP.
That puts a lot of other companies at risk.
It is shit like this that makes me happy that I do not use the telephone.
Seriously, anybody who didn't see Vonage's failure coming before the IPO deserves this. They were an unprofitable company in a saturated market with a product (Voice-Over-IP) that doesn't appeal to most folks.
Sure, $20-25 per month for phone service is a wonderful deal but the major players with rock solid products have similar prices ($30-40 per month). And in effect, they will be de-listed soon and become another ghost in the great halls of technology company who never made it.
Support the 30 Hour Work Week!!!
The reason all of th big telco's are going after vonage iss because its business model is far better than their's. Simply put, they're afraid of competition.
Von Boyage?
Previously: "Linux... Toward the Sunrise..." Now: "Linux... Toward the-- No, now, part of Every Sunrise"
Guess this means I shouldn't buy that VonageLinksys router gizmo on clearance at Wal-Mart?
Or maybe I can flash it into something useful when Vonage dies?
deleting the extra space after periods so i can stay relevant, yeah.
This will be a simple one for Vonage customers. What I know Vonage will do is to increase charges for their customers. From their present customer base, a flat 0.1% charge will solve that cash flow issue.
How is losing jobs to outsourcing worse than losing jobs to patent law suits? I ask since no one mentions the lost jobs in these kind of cases.
"Thanks for all the money you paid to us. We've used it to buy off ISO among other things" -Microsoft
Read the article, Vonage may default in 13 months (December 2008) not in 1 month (December). Do the editors even *read* what they post?
- The unexamined life is not worth leading -
Granted, as in Monty Python and the Holy Grail, "I'm not dead yet!" but it's sad to see this happen. I was a customer of Vonage almost since they started, and have been quite happy with their service. I only recently canceled on account of simply not needing a home phone and having a company-provided cell phone that I can use for personal calls.
This really irks me.
Point 1/.
Patents were invoked as a means of protection of IP, and fair enough.
If a patent owned by A is a core part of its operation, and B uses it as a core part of its operation, then fair enough. But in this case these patents have little or no bearing on A's operation and little or no bearing bearing on B's operation.
The IP violation is not worth the penalty provided to A, and is not worth the penalty charged to B.
Point 2/.
The powers that be in your country spout, as one of the bases of democracy, an open, competitive system.
To see patents being used so blatantly to crush opposition is NOT indicative of an open, competitive system.
To me it is crazy.
Welcome to the real world?
No.
These are just lazy, fat, protectionist nobodies in their ivory towers.
No different than the RIAA / MPAA.
Crush them I say.
Good news for Comcast and AT&T if Vonage goes away: They won't need to block Vonage to "encourage" their customers to switch over to their similar VoIP services AND they can raise their rates.
I appreciate what patent law is meant to do, protect and encourage inventors and developers to invent and develop. It seems though, that as of late, it only succeeds in limiting and discouraging people from trying to develop something useful. I seems to me that with the nature of today's technology, that if a company develops a patent and does not try to produce or license the technology, they should loose the ability to sue over its use. -lp
Diplomacy is the art of saying, 'Nice doggie!' till you can find a rock.-- Wynn Catlin
Dibs on patenting the wheel.
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You are too late..
However, in that case, an Australian lawyer was able to sneak the wheel patent through a fast-track application system. The US patent went through the full application procedure.
Refrence;
http://www.newscientist.com/article/dn2178.html
The truth shall set you free!
Please post your experience with other VoIP companies that compete against Vonage in this thread.
GreyPoopon
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Why is it I can write insightful comments but can't come up with a clever signature?
I once FOUGHT to get DSL from Verizon, and they did EVERYTHING to make sure they wouldn't get my money, even disconnecting me while transferring my call to the "proper department" three times, hanging up on me once, telling me they service an area and later not following up when they said they would. Tech never shows up, etc.
Seriously, if they want business, such as mine, for example, the sun will go supernova before they get it.
" What luck for rulers that men do not think" - Adolf Hitler
It may not be as bad as it seems if Verizon can't distinguish between .002 cents and .02 cents.
1. The Vonage name has excellent recognition due to their heavy investment in advertising.
2. Vonage has a paid up license to use the patents required to implement Voip.
3. The various patent holders (Verizon, ATT, one other) should probably go after other Voip providers like Packet 8 who don't have nearly the cash on hand to survive the suits. Therefore, the VOIP consumer marketplace may have only one competitor soon.
Don't buy their stock, for it may go to zero, but also don't expect Vonage to go out of business. Someone will likely want their assets at a reduced (below book cost) price.
This is part of that "social bargain" that government is.
Let me rephrase, you waive your right to free choice in all things, and in exchange you receive whatever those you voted for feel that they owe you. Generally its mediocre services (such as justice or medicine), or total and complete abuse (such as prohibitionist laws, feel good propaganda and theft of personal property through armed robbery (confiscation) or fraud (taxes for "necessary services")).
Whenever a company with good service shows up (and Vonage was among them when they first started out), they get shafted by the collusion of the tools of government (corporations) and the tools of corporations (government). Who gets the shaft? Those whom the government is supposed to "protect".
Get over it folks, every time you rely on crooks to stop other crooks from robbing you, all you get is "We've robbed you twice, but don't worry, we'll make up for it!! Stay here, we'll be right back with a bigger bag."
" What luck for rulers that men do not think" - Adolf Hitler
Patents by definition restrain others from selling the patented invention. You may be alluding to patent misuse, but that doctrine really doesnt apply in the Vonage case.
I remember the day I switched to Vonage. I remember with great satisfaction opening the access panel in my ceiling and yanking the phone cable out of the junction box and plugging in my Vonage cable. And last spring I enjoyed even more ripping up 45 feet of buried phone cable while doing some landscaping. I don't care if Vonage has to raise their prices to the same rate or higher than the regular phone companies. Screw them. Why do so many people belong to Netflix when there's a Blockbuster just down the street that you can also rent by mail? Because we remember all the times we took it in the shorts for late fees. The only reason they're lowering prices and renting online is because of Netflix. If Netflix goes away we're back to being screwed again. The telco's have sucked for too long and will never get better without real competition. I hope Vonage sticks around. Hell I even prefer my MetroPCS service to AT&T. I can barely get reception in my house and there are lots of places I can't get service but by God I'd rather pay $30 bucks a month to the little guy than get reamed with overages, at least everything's unlimited on MetroPCS.
What's with the $2.5 million to charity? Is this a common thing in such lawsuits? And does anyone know what charity/charities?
"Anyone who [rips a CD] is probably engaging in copyright infringement." - David O. Carson
This is exactly why backbone providers need to be backbone providers. If you allow the backbone provider to also be the telephone company and the ISP they have a monopoly.
Now it's one thing if Verizon paid for all their infrastructure but more than likely it was paid for by tax dollars.
Vonage, I'ma lookin' at you, bub...
sig sig sig siggy sig
WTF are Vonage lawyers doing, they should've ask for these obvious patents to be reviewed. I skimmed through these and all I saw were claims about doing something on the internet.
If somebody from Vonage is reading this, fire your lawyers and hire some good ones.
HTML is obsolete. It's time for a new, simpler and richer markup language.
It's a damn shame to see a well run business get fucked over by the dickhead kinds of capitalists....
In capitalist barberica, profit gives way to mediocrity!
About time. Now to get a good seat to watch the cindering ashes as this company goes down. They deserved it so much for so long.
Like the incumbents were going to just allow a startup take away their bread and butter. Internet? Piss on that. Cable? Same. Phone calls. The Baby Bells make a SHITLOAD of money on old fashioned telephone calls.
To be fair the Australian "innovation patent" law is more like a provisional patent in the US - it really has no legal standing until some additional legal work is done.
anybody wanna wager a guess how long it takes AT&T to do something similar?
...discovers Vonage.
Hey; where's my user id? I can't feel my user id!!!!
Does this mean im out of my contract? lol
So, if they do go under, will the sell the van from the commercials? I want to bid on it!!!!!
I just took a look at the vonage deal in the uk and it's got me interested. Especially the concept of taking my vonage box with me to anywhere with a broadband connection.
Then I had an idea, that must have been explored already. Would it be possible for someone outside my lan to connect to my lan and then use my vonage (other voip) account to make calls? How about routing incoming calls to other IP's perhaps some kind of system that would greet a caller with please select an extension say 1 to 9 and 1 could be local to my lan 2 could link to my sisters IP 3 to a friends IP, 4 to an ip I could specify on the fly so my calls could be rerouted to where ever I was in the world.
I guess Skype kind of achieves some of this already to an extent in that its possible to log into a skype account anywhere.
Maybe it's possible to do something like this with a standard pots line routing into a pc based exchange?
Anyone have any insight into whats available and hopefully legal.
Blarney Quality Restaurant, Plants
No amount of "giving to charity" will sanitize this anti-capitalist, corporatist, bullshit greed.
OOhhh... I know. Give 2% to some charity. That should solve our pr problems! Shame on them for even bringing it up.
To boldly use to and too two times and get it right too! They're not gonna believe their eyes when they see it there!
Can anyone recomend an alternate vip/viop provider. I'm looking for something with free LD in north America. And available in canada (so they don't have some weird rule about us company selling voip to the enemy (oh noez!!)).
Any help?
oogly boogly!
WTF, they're not reselling basic phone service. They're providing value added VOIP over the internet service customers might receive from a company that also provides regular phone service.
If I lease a car to someone, and they use it for a taxi service, how exactly is that unfair?
If McDonald's sells burgers and provides public outdoor seating (hypothetical, they really don't AFAIK), and someone opens up a hotdog stand across the street, what wrong is being done?
The phone line required for DSL service doesn't even compare to Vonage's service. Will AT&T email you and anyone else in your household a copy of all your voicemails? Virtual numbers? Pick your own area code? Portable service? Transfer to another number when the service is unavailable? Softphone? How much do phone companies charge for anything close to those features, if they are available at all? How many offer additional lines for $5? I'm curious, do phone companies get all pissy because dial-up ISPs are getting "free rides"?
Vonage is a HUGE added value over basic phone service, and the fact that it can run over a traditional phone company's INTERNET service is completely irrelevant.
I can "sling" TV over my cable provider's internet service too. It's not sleazy reselling like you suggest. There's absolutely NOTHING wrong with it. If phone/cable companies don't want to enable competition via the internet, they need to stop providing internet service. You can't have your cake and eat it too (without lots of sleazy lobbying).
Support Vonage, because when they go, we'll slip into a VOIP dark age. Look how "innovative" your phone and cable service providers have been over the last decade, that's what you'll have to look forward too.
I fear for Vonage's demise. At least here in eastern Canada, no one can touch the rates they offer. I'm quite happy with the service, more than happy with the features, and love the great price. I dread being forced back to an expensive, featureless Aliant land line, all because of big US telcos beating up on Vonage. Hopefully someone else will step in if they die, but it sounds like some of these patents are so broad (sending packetized voice data, blah blah blah) that without patent reform, nobody will be able to.
Love many, trust a few, do harm to none.
Let's just see what happens when Google buys up all that spectrum, and kills the phone companies. Bye bye Verizon!
No, seriously, I just come here for the articles.
To be fair the Australian "innovation patent" law is more like a provisional patent in the US
OK to be fair, it shows they put in dibs first.
The truth shall set you free!
What few people realize is that patent law trumps competition law. This is one reason large technology firms are so pro-patent even when it creates huge risk for them. Collusion between firms that would be considered illegal cartel-forming, and result in 20-year prison sentences, becomes 100% legal when there is a single patent involved.
What is happening to Vonage is what happens to every aggressive competitor in a market dominated by incumbents and protected by patents. It does not matter how innovate a new firm is. It will, always, infringe on a basic patent somewhere, and end up in a war of attrition that the incumbent will usually win. The innovator has two choices: die, or sell out.
Patents do not drive innovation, not in software and not elsewhere except maybe, maybe in pharma. They promote the self interest of large business and of the patent industry, period.
Note that Microsoft's patent war on FOSS goes along exactly the same lines. Convicted monopolist pleads guilty (in the EU) and move toward a patent licensing business, blessed by the regulator, which allows it to destroy and/or buy up its real competition.
This is about the strongest argument against software patents. They are literally a tool used by cartels and monopolists to control or destroy their competition. It's amazing that after 150-200 years of this discussion, governments still don't realize what kind of damage they do.
My blog
It's so odd how business has become the new 'war'.
Strategies that must be millennia old foisted with seeming deadly precision against upstart enemies.
Peace seems so elusive sometimes, when by rule, those in business must be wary of the competition (in so many forms), supply chain, the ambiguity and vaguery of patent laws and outcomes of litigation, then coupled to a seemingly benign government, employment law, and a the whims of the stock market.
The reason that pharma patents do so well, is because a resultant cost of goods is low and somewhat predictable, and the supply/demand is health and/or death..... two very strong motivators. Yet I question the enormous retail costs of needed pharmaceuticals for the third world, especially the HIV victims in subsaharan Africa.. or the chemo regimen for various kinds of cancer..... at what cost, and pain.... and what restraint of trade (if quality of manufacture can be the same?).
The err seems perpetually imbalanced.
---- Teach Peace. It's Cheaper Than War.
Um....to parent...someone who gets DSL from a telco, but uses vonage over that line should NOT be hurting the telco bottom line. they should be making a profit off the DSL service. if the telco is not doing that they should go under. The other option is that customer could get a cable modem instead, and use vonage, an then the telco would not be getting any money, they should be HAPPY to have a DSL only customer. I know my local telco is happy to have DSL only customers, since they charge TWICE the price for DSL only, compaired to adding DSL to other services, of course when I say happy i mean how much they get each month $$$$ for that service.
I think you are actually confusing the issue with the issue of DSL ISP's being allowed to use the local telco wires to the home to offer DSL in direct competition to the telco DSL service. In which case you are just off topic.
Those who can, do.