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May 08, 2006

Vonage going public

One of the things I like about American business processes is the merciless confessional process companies go through as they do an initial public offering. Vonage is stripping itself naked right now. Among the risk factors: It's losing money at an increasing rate as it buys ads to gain marketshare - It's got 1.6M users. It's in violation of the E-911 regulation (which does not fit easily on VOIP providers). Vonage chairman and founder settled with the SEC over fraud accusations at his previous company; he will own 33% of the outstanding common stock. Plus, of course, Vonage could be wiped off the board if carriers are allowed to violate Net neutrality by charging more for Vonage's VOIP bits than for their own. (There's also stuff at the top of p, 20 about the dilution of common stock. Is that usual?)

Vonage is enabling its early customers to participate in the IPO, which is nice of them. I'm eligible, but won't participate: I'm a happy Vonage customer but I almost never buy stocks. (I should perhaps note that a blog post from a couple of years ago about Vonage continues to attract comments about how awful Vonage's customer service is. I personally have no complaints.) [Tags: vonage ipo voip net_neutrality]

Posted by D. Weinberger at May 8, 2006 09:37 AM


Comments

I’ve had Vonage since 2003…The quality is not like a land line, but for the most part it suites my needs. I like the ability to forward my calls to a cell phone or work or wherever I want. I think they will make it and eventually like all good small companies they get bought out by the big boys so they do not have to invest in the infrastructure to be as good as Vonage.
Will I buy their stock? Yep...I like taking a risk and I think this will be a profitable one. Maybe not right off the bat, but in the long run, it will.

Posted by: George S. | May 12, 2006 08:50 PM


I was a Vonage customer during the period that determines eligability, but wouldn't touch that stock with a 10 foot pole. I think the company is nothing short of absolutely terrible, and I think that word is starting to get around.

Posted by: Adam | May 15, 2006 01:19 AM


I recently cancelled within a week of signing on with Vonage. They misrepresented what their services offered with multiple lines and then gave me HELL to try to disconnect service. They threatened me with early termination fees after I was sold their supposed "money back guarantee". Seems to save money and offer a decent product so long as you UNDERSTAND exactly how it works and do NOT intend to call customer service for anything, unless you have a HALF HOUR to wait for a customer service rep!

Posted by: Sean | May 18, 2006 03:53 AM


I have been a tried and true Vonage customer for about 3 years now, and have stuck with them thick and thin (as their technology and glitches were worked out over time). Three years ago, we dumped our local (SNET at that time) land line, saved a few thousand $$ over the years (no doubt). The minor glitches were worth the savings, and yes, today their services are VERY good. I have also recruited at least 6 other people over time, and Vonage rewarded me with a one month free service for every person I joined (thank you Vonage .. this is most likley the only profit I will make, besides the nice tee-shirt they sent me with the Vonage logo .. to futher stimulate free adverstising .. good plan )The tee shirt was a surprise in the mail, as one can see, they have worked real hard
Anyway, this morning I did buy 300 shares as part of the IPO, but after realizing the vulnerability, tonight I pulled out all together. It made NO sence at all to buy it .
I must say, for the past 2 years I have wanted to purchase their stock if they ever came public, and swore up and down I would. Oh well.
Yes, I am VERY disappointed in this offer, and am too nervous at this point to invest after fully digesting the financials. Its too bad, I think they could have stood a chance if the entry price was lower, and start up share volume was smaller.
I hope whoever buys them, ( just a guess from my web browsing) it all works out for the best!

Posted by: Ray | May 18, 2006 07:20 PM


Vonage IPO for the customers is just another fraud Citron is going to commit after his finance sector one. They are not allocating the stocks to the customers at all,it was more like advertising stunt.
Vonage Managment is big fraud and Citron will run with your money if you invest. They don't have any cash to run the company and no one will buy their business as they are loosing money in a big tune. They spend more in making a new customer than actual servicing a customer. Their Customer service sucks. Do you know that you have to pay in case you have to get your number changed........
So keep your money with you and invest it in laser and energy stocks rather than this runaway bride.

Posted by: MB | May 23, 2006 09:43 PM


I cancelled my Vonage account with 6 months of having it, they charged me a termination fee for this. After cancellation, they sent me an email saying if I returned the equipment, they will refund the termination fee. I returned the equipment and waited for 6 months only to be denied of the termination fees. I spent extra money to ship the equipment back to vonage. This company has no ethics. Any other company would have honoured their statements to the root. I hate Vonage. DO NOT INVEST in this company....

Posted by: Mash | June 5, 2006 02:09 AM


Customer service is a joke! They are rude and unaware of their own promotions. I am on hold, at this VERY moment, and have been for 37 minutes. That is after being transferred to four different departments.
This company is a joke and i'm am now holding to speak with someone about cancelling. I'm sure they are going to get right to me.
What a JOKE this company is.

Posted by: Jennifer | July 11, 2006 09:31 AM


I too, must admit, vonage has the worst customer service I have ever seen. I have "tried" there service and have been charged $30 for trying it. I never even received their box. Now they say I owe them $85. for a box I finally received and then shipped back. There employee's are RUDE and wait time has been 45 minutes. What a JOKE!

Posted by: Stacee | July 13, 2006 11:46 AM


I signed up for Vonage in April. They were unable to complete my number transfer within the "guarantee" period. Since they were having so many problems with the process, I attempted to cancel on the 29th day of their 30 day "guarantee". Instead they offered to extend the "guarantee" for another 30 days. When they were still unable to get teh transfer completed, I again attempted to cancel on the day before the "guarantee" expired. WRONG. They refused to refund the money for their propriatary equipment. I took them to the BBB and they ignored my complaint. Luckily my Credit card company reviewed my notes and refunded all my Vonage charges. This company is more than lacking in customer service. They are preditory. I love the VOIP technology and have my service with I-Cloud. (www.geticloud.com). They offer the same technology as Vonage, but when there is a problem the customer service is amazing. I have even had the owner call me to resolve any issues. (Warren)

Rick Mays

Posted by: Richard Mays | September 16, 2006 02:56 PM


I have been reading consumers' posts regarding Vonage's services and practices. I work for a consumer rights law firm and I'm investigating Vonage's actions. I would like to hear from consumers about their experiences with Vonage. If you are interested in sharing your story, please email me at abby1100ny@yahoo.com

Posted by: Abby | October 12, 2006 04:00 PM


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