Vonage Loses Verizon Patent Suit
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Vonage tells customers to hold fast after patent court rules in favor of Verizon. Plus: Stocks tumble again. LG goes to Iran. And more.
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(InfoWorld) - Shares of Vonag plunged Friday in the wake ofÂ a patent-infringement ruling against the companyÂ that some analysts called a grim outcome for the VoIP service provider. Vonage stock fell $0.69 to $4.17 on the New York Stock Exchange, losing more than 14 percent of its value, after a jury decided on Thursday that the company infringed three Verizon patents on commercial VoIP services technology. Vonage was ordered to pay $58 million in damages and a 5.5 percent royalty rate on future sales. Verizon also is seeking a permanent injunction to keep Vonage from using the technologies. Vonage plans to appeal. The ruling comes after a string of setbacks for the scrappy service provider, which has yet to make a profit. Vonage was founded in 2001 and has built up its customer base to more than 2.2 million through heavy investments in marketing. Along the way, it has become the most visible independent provider of VoIP, which puts voice calls on data lines for lower cost and some extra features. TheÂ company has claimed Verizon sued in order to eliminate a competitor to the traditional circuit-switched phone service that is its bread and butter. Although the judgment is not very big compared to some, it could be devastating to Vonage if it stands, analysts said. "It's a drop in the bucket, but they need every cent they can get," said Will Stofega, a VoIP analyst at IDC. The company is already dealing with shareholder lawsuits over its disappointing IPO last year along with difficulty meeting regulatory requirements like E911 emergency service and the Communications Assistance for Law Enforcement Act, he said. The $58 million sum is about as much as the company is losing every quarter, Ovum analyst Jan Dawson pointed out in a research note on Friday. Vonage lost $65 million in the fourth quarter of 2006. "As this case gets more coverage, potential customers will be worried about signing up for new service with Vonage, and existing customers may churn in larger numbers than usual. Both of these effects would be disastrous for Vonage," Dawson wrote. Verizon might also go after other VoIP providers for infringing the patents, Stofega said. Big providers like the cable operators could absorb royalties, but smaller independent players would be even more vulnerable than Vonage. Already, regulatory requirements and "a race to the bottom" on pricing are threatening the stand-alone VoIP service business, he said. In a few years, many more people will be using the technology, but VoIP companies as such may become a thing of the past. Jeff Pulver, a longtime VoIP booster who co-founded Vonage before leaving the company, was more optimistic in an entry on The Jeff Pulver Blog, in which he called the ruling "the end of the seventh inning," a reference to baseball, which has nine innings. "This isn't the end of the battle," Pulver wrote. "I hope and trust this decision does not curb innovation and progress in VoIP and other Internet communications products, services, and applications."
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Vonage is getting sued--again. This time telecommunications equipment maker Nortel Networks says the company has violated nine patents related to its Internet phone service.
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A U.S. jury found that Vonage Holdings  Corp  had infringed patents owned by Sprint Nextel Corp   and ordered the Internet phone company to pay $69.5  million in damages, triggering a 34 percent fall in its shares.
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An appeals court agreed that Vonage infringed on two Verizon patents but sent the case for retrial regarding a third patent.
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Verizon Wireless customers are suing  the mobile service provider, claiming that it is selling a cell  phone with fewer Bluetooth short range radio features than they  expected, the plaintiffs' lawyer said on Thursday
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In the opening salvos of the patent infringement case between Vonage and Verizon, the telecommunications company claimed Vonage caused serious harm, while the VoIP provider said it had no knowledge of Verizon's patents.
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The state of California is mounting a legal challenge to a recent Federal Communications Commission ruling that VOIP phone services sold by Vonage Holdings Corp.
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Internet phone service provider Vonage  Holdings Corp.  on Monday said it has been served with a  patent infringement lawsuit filed by two units of Verizon  Communications Inc. .
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NEW YORK -   Verizon and Vonage on Wednesday will present opening statements in a patent-infringement case that could have a big impact on consumers and the nascent Internet telephone industry. Most immediately at risk is the future of Vonage.
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Vonage Holdings and Nortel Networks have preliminarily agreed to cross-license several patents, ending a dispute between the companies without any monetary payments, Vonage said Monday.All claims relating to past damages as well as remaining payments will be dismissed, the company said. Documents sealing the agreement have not yet been finalized.The agreement is a minor victory for Vonage. The company has settled or reached tentative agreements in three other patent disputes related to VoIP (voice over Internet Protocol) and other telecommunications technology for what could ultimately reach $239 million in payments.Vonage tentatively agreed last month to&#160;settle a patent infringement lawsuit filed by rival AT&amp;T&#160;for $39 million. Prior to that deal, Vonage had reached&#160;settlements with Sprint Nextel&#160;for $80 million and&#160;with Verizon Communications&#160;for $80 million to $120 million, depending on the results of an appeal.&#160;
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ALEXANDRIA, Virginia  - A jury dealt a blow to loss-making Internet phone provider Vonage Holdings Corp. on Thursday, ordering the company to pay $58 million plus royalties on future sales for infringing three patents owned by Verizon Communications Inc..
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A U.S. appeals court on Friday upheld an order by U.S. regulators requiring Internet telephone services like Vonage Holdings Corp. to contribute part of their revenues into a federal subsidy fund.
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A federal jury in Alexandria yesterday ordered Vonage Holdings, an Internet telephone company, to pay $58 million to Verizon Communications for infringing its patents in a case that raised the possibility that Vonage could be barred from conducting much of its business.
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ALEXANDRIA, Va. -- Internet phone company Vonage infringed on three patents held by Verizon Communications and must pay $58 million plus possible future royalties to its competitor, a jury said yesterday.
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AT&T filed a lawsuit against VoIP provider Vonage Holdings, seeking damages for alleged patent infringement.
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'Sprint and Verizon got nothin' on us' Yet another big-name telco has sued Vonage for patent infringement.â¦