Vonage VoIP Equipment

Vonage Inks VoIP Equipment Deals

August 24, 2004

By Jay Wrolstad

VoIP firm Vonage has joined with Cisco Systems subsidiary Linksys and Netgear in an alliance to boost use of the Internet for voice phone calls. The partnership with Netgear includes the launch of a voice-enabled 802.11g (Wi-Fi) wireless router and a wired two-port telephone adapter/router.

Internet phone service provider Vonage has hooked up with Cisco Systems and Netgear to sell equipment that supports the company's Voice over Internet Protocol (VoIP), with an eye on increasing its subscriber numbers in a competitive market.

Cisco subsidiary Linksys initially is providing a dual-port phone adapter and a dual-port broadband for use with Vonage's VoIP service. Linksys also plans to deliver a Wireless-G local area network router with two phone ports in the coming weeks.

The two new devices both support session initiation protocol (SIP), and are compatible with a cable or DSL high-speed Internet connection. They feature a built-in Web and offer common telephone features, such as caller ID, call waiting and voicemail.

Adding the Wireless Connection

Vonage is targeting consumers and small businesses with the new equipment, banking on Linksys's position in the broadband networking-technology market to draw more customers.

The partnership with Netgear involves the launch of a voice-enabled 802.11g (Wi-Fi) wireless and a wired two-port telephone adapter/router, among other broadband telephony-equipment products under development for Vonage. The first devices, expected this fall, will integrate the latest VoIP and wireless LAN chipsets from Texas Instruments.

"Adding Linksys and Netgear brings recognized networking brands to our customers, and provides them with more choices," said Louis Holder, vice president of product development at Vonage. With the multi-port routers, subscribers can connect multiple PCs, and Wi-Fi lets users make a wireless network for both voice and data networking services, he told NewsFactor.

Staples To Sell Vonage

In a related development, Vonage announced that retail office-supply chain Staples will sell Vonage services in its 1,200 stores throughout the U.S. and online at the Staples Web site.

Broadband users who sign up for Vonage service can purchase one of two Vonage starters kit at Staples, both featuring Linksys devices.

The partnership with Staples follows closely on the heels of an announcement by AT&T that it will market the CallVantage VoIP service in Best Buy.

New Handsets Needed

Vonage service is sold directly by the company and from other retail partners including Amazon.com, RadioShack, Best Buy, Circuit City and Office Depot.

"Vonage needs to boost its customer base, and while these announcements add to the company's equipment portfolio, they don't necessarily translate to more subscribers," IDC analyst Will Stofega told NewsFactor.

He suggested that the introduction of new VoIP-enabled handsets will be a more significant development for Vonage and its competitors. "The big question is, when will they offer a phone that enables roaming among cellular and Wi-Fi networks?" Stofega asks.

Vonage's Holder said his company is working on a handset that uses wireless LANs for a broadband Internet connection.

IDC projects that by the end of 2005 there will be some 1.5 million broadband telephone service customers, representing steady growth in a new market. Vonage currently is among the market leaders, with about 250,000 subscribers.