6 thoughts on “Vonage Wireless or a desperate move?”

  1. Om, if things go bad for Vonage, as the story sounds, what happens to the customers? Not so much the wireless, but their traditional business. More so out of curiosity, but I did happen to sign up with them this weekend, for my rental properties line, strictly based on price. Do they get snatched up, and if so, by whom/what types?

  2. Maybe you are not right, Om.

    I think there is still enough space for a great cellular/Wifi MVNO. A company that lets you make mobile phone calls wherever you are, using always the cheapest way possible: When in a Wifi zone for the small Vonage prices and outside Wifi for the normal cell phone prices, hopefully with a seamless handover.

    Taking these ideas into account I see for Vonage the Truphone modell as applicable, but directly starting whith a much broader base of clients and Wifi hotspots.

  3. MVNO is a tough road. ESPN couldn’t make it. Helio with a 100k lines and Amped with 30k lines are considered big. No a big market.
    It would be a great for both ELN and Vonage of that phone was a Helio phone.
    “Marketing costs were up 50% this quarter to $96M – just 53% of revenue.” Sub acquisition cost is over $300 (and I would argue even higher than $400). How do you get that back with an ARPU of $27????

  4. Just as Vonage is getting whacked by Cableco VoIP this year, they will get whacked by Cableco MVNO next year or the year after. What is it about Citron that he loves getting into these plays that have such a short lifespan? If this were a small company, I wouldn’t question it, but these guys are too big and owe too much money to play such games.

  5. Michael,

    the interesting question is what do they offer in the long term.

    I think Vonage needs to figure that out: the cheap voice game isn’t going to work, but it is an attractive hook to get customers. they need to figure out a way to upsell the customers.

    i have some ideas but not sure if i can share them right now, and will post later when i have totally thought it through and done some reporting.

    who could buy them? I think that is anyone’s guess. I think Vonage itself should just start gobbling up smaller players, and bulk up through acquisition, instead of blowing millions on advertising campaigns.

    they can lower their costs and get some kind of scale going for them. at that point an alternative carrier like embarq might want to pick them up as a way to get into the bell territories.

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