Vonage

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Vonage Holdings Corp.

Type	Public (NYSE: VG)
Founded	January 2001 in Edison, New Jersey
Headquarters	Holmdel, New Jersey, USA
Key people	Jeffrey A. Citron; Chairman, Chief Strategy Officer and Co-Founder Michael Snyder; CEO John S. Rego; CFO
Industry	Communications services
Products	Voice over IP
Revenue	$269.196 million USD(2005)
Net income	$261.939 million USD(2005)
Employees	1,416 (2005)
Website	www.vonage.com

Vonage Logo until 2006

Vonage (NYSE: VG) (pronounced [vˈɑnɪdʒ]) is a commercial voice over IP (VoIP) network and SIP company that provides telephone service via a broadband connection (the company's name is a play on their motto "Voice-Over-Net-AGE").

Vonage is known as the "Broadband Phone Company" and has recently marketed itself as "Leading the Internet Phone Revolution." Vonage currently holds the most subscribers, and is currently operating on 1.8 million lines having completed well over 5 billion calls. It was Vonage that has led the Voice over Broadband (VoBB), or Broadband Phone industry through its aggressive consumer marketing in the United States, Canada, UK and other countries globally.

In order to use the service, customers must purchase or use a branded "VoIP router" or a phone adapter that connects to their main router or broadband modem. In addition, an upload speed of 30–90 kbit/s as well as a reliable/QoS optimized connection is necessary to make calls without substantial lag or jitter.

Vonage was originally based in Edison, New Jersey but is now located in Holmdel, New Jersey, in a building previously occupied by Prudential ^[1]. Vonage offers services to subscribers throughout the United States. The company expanded into Canada in April 2004 and into the United Kingdom in January 2005.

Vonage went public on May 24, 2006 at a price of $17 a share. The price on 1 November 2006 was $6.88 [3].

Prior to the IPO, Vonage solicited its customers via automated phone call announcements and emails with an offer to buy shares of the IPO. The price fell $2.15, or 12.7 percent, to close at $14.85 on the New York Stock Exchange. Vonage's IPO was the worst trading day for any IPO in 2006 up to that point. The IPO raised $531 million for the company.

1 Telephone number availability
2 Emergency call issue
3 Verizon lawsuit
4 Commercials
5 Service Cancellation
6 Fax, alarm and TiVo/DSS compatibility
7 See also
8 References
9 External links

[edit] Telephone number availability

Subscribers are permitted to choose any number in the country of the service they subscribe to for their primary line. Whether it be Vonage US, Canada or UK, subscribers may choose from any area code regardless of their actual residence. Subscribers also have the option of obtaining additional "virtual numbers" for a monthly fee. For example, a subscriber in Florida may choose a number with Manhattan area code 646, allowing callers from New York to be billed only for a local call. In addition, Vonage also offers 'virtual numbers' in Mexico, Canada and throughout Europe for any and all customers to choose from. This is especially beneficial to businesses with an international client base. While Vonage supports porting a telephone number in the US via the FCC's Local Number Portability (LNP), Vonage does not offer phone numbers in every area code in the United States.

Although only residents of the US, Canada, and the UK may subscribe to Vonage (paying with a credit card from their respective nation), the routers with phone ports can be plugged into the internet anywhere in the world. For instance, a student studying abroad in Brazil plugs the router and phone into cable internet service in the apartment or into an internet café that accepts notebook computers (LAN plug-ins), and the service works with the original local phone number and pricing. The student thus receives calls from and makes calls to the home country for no extra fee. International pricing is often so low that it can be cheaper than calling direct in the same country. For example, the Vonage price to Rio de Janeiro is USD$0.06/min (2005), but calling from a cell phone or payphone in Brazil costs about USD$0.20/min. Vonage also offers a USB phone adapter that connects a telephone to the USB port of a computer that has internet service, giving it a dial tone and a normal interface to the worldwide telephone network. Family members often subscribe to Vonage and then ship or carry the routers to loved ones in other countries to use.

[edit] Emergency call issue

A frequent criticism of Vonage and other VoIP providers is that, since the physical location of a caller may not correspond to his or her listed phone number, traditional emergency telephone number service, such as 9-1-1 in the US and Canada, is not available. Vonage provides its own emergency telephone number service called e911, but the service requires subscribers to register their address with the company and is not operative in case of a power failure.

[edit] Verizon lawsuit

On June 19, 2006, Vonage acknowledged that Verizon has filed a lawsuit charging that Vonage infringed on seven of its patents related to its VoIP service. They claim that Vonage infringed on patents that describe technology for completing phone calls between VoIP users and people using phones on the traditional public switched network, authenticating VoIP callers, validating VoIP callers' accounts, fraud protection, providing enhanced features, using Wi-Fi handsets with VoIP services and monitoring VoIP caller usage. Verizon is using this technology in its own VoIP service called VoiceWing.

In a statement, Vonage said "its services have been developed with its own proprietary technology and technology licensed from third parties." The company also said it would "vigorously defend (against) the lawsuit." Vonage said it hadn't been previously notified by Verizon that the company thought it was infringing on its patents. ^[2]

[edit] Commercials

Vonage is well known for its distinctive music in its commercials. The song title is "Woo Hoo" — by the band The 5.6.7.8's. Vonage has also released a television commercial in some affluent test market areas, apologizing to investors for post IPO performance of the company's stock and reassuring investors they are the number one priority.

[edit] Service Cancellation

Vonage requires customers to cancel service by calling a toll free number, as service cancellation is not available on-line. Customer descriptions of the cancellation process frequently involve hold times of approximately ten minutes. Difficulties faced by customers when attempting to cancel Vonage have been detailed in blogs ^[3] ^[4] ^[5] as well as a May 2006 Wall Street Journal article ^[6] which related one customer's experience with a Vonage representative who refused to cancel an account unless a repair attempt was allowed by the customer.

Despite marketing their service as having no contracts or long term commitments, Vonage charges customers a fee for cancellation within the first year of service. This fee is noted in a Terms of Service contract. The fee is $39.99 per voice line which is disconnected. A "Rebate Recovery" fee is also assessed if the account is cancelled after the 30 day money back guarantee, but before 180 days of service. This fee is the "instant rebate" which is offered on the web site when signing up and is different for each device.

[edit] Fax, alarm and TiVo/DSS compatibility

There have been are widespread reports of difficulty in operating Fax machines on Vonage lines, either dedicated Fax lines, or regular Vonage lines.^[7] Difficulties have also been reported with residential alarm systems and Tivo.