Canada added, UK and Switzerland to come in third quarter

Posts: 29 · Vonage Forum Junior Joined: Aug 12, 2003 Posts: 29

Well, Vonage Canada is up and running, but there's no info in French. (Heck, they cover Quebec!) If they think having info in two languages, wait until they start up in Switzerland. German, French, Italian- plus English. Cablecom in Switzerland already have their own digital phoneservice, but I don't think if it's as portable as Vonage's.

Quote:

U.S. Internet Telephony Company Vonage Is Gearing Up To Start Services In The U.K. And Switzerland

April 8, 2004

By Taska Manzaroli

BERLIN (Dow Jones)--U.S. Internet telephony company Vonage is gearing up to start services in the U.K. and Switzerland in the third quarter and won't stop its European drive there, Chief Financial Officer John Rego said.

Vonage has gained more than 130,000 customers since its creation in 2001, and over 5 million calls per week are made using its flat-rate phone service. The company raised $40 million in financing in February, saying it would use the cash to accelerate expansion abroad.

Based in Edison, New Jersey, Vonage this year launched a service in Canada.

In Europe, it will start in the U.K., and then move into Switzerland before looking at other options.

These two countries "are just the beginning of the story," Rego said in an interview with Dow Jones Newswires. "You'll probably see us in other countries by the end of the year," Rego said, adding "we've got a lot of momentum."

Internet telephony is cheaper to offer than traditional phone calls, making the technology a threat to Europe's largest telecommunications operators like Deutsche Telekom AG (DT), BT Group PLC (BTY) or France Telecom SA (FTE), which rely on voice for a major chunk of profits.

So-called Voice Over Internet Protocol, or Voip, sends voice signals as packages of data via the net. Users need a high-speed Internet, or broadband, connection and can plug their phone in to a computer anywhere in the world, keeping the same number.

Deutsche Telekom Chief Executive Kai-Uwe Ricke sees Voip as a way to enhance the broadband connection and said last month he's considering how to exploit the technology. Ricke also reckons the impact of Voip is overestimated given call charges are very low in Germany.

Still, Vonage isn't deterred. When asked whether Germany is a potential market for Vonage, Rego said it's "not beyond the realm of possibility."

There are some 20 million broadband subscribers in the European Union, making it almost as big as the U.S., and showing a big and speedy increase from a year ago, he said.

Rego reckons it's difficult to go into countries controlled by one incumbent, or where the dominant player is state-owned. The U.K. has a similar regulatory environment to the U.S., which is encouraging, he noted.

Vonage is looking for partners, though Rego wouldn't be drawn on specifics.

In the U.S., Vonage works with traditional telecoms carriers, cable operators and retail electronics chains like Best Buy Co. Inc. (BBY).

Rego noted the U.K. doesn't have "enormous" electronics chains, meaning the company will have to mull different options. During business trips, people have suggested Rego look at selling the service in U.K. supermarkets, he said.

"We're speaking with everyone who will talk to us," Rego said. "Vonage has a lot of work to do - a lot of meetings to have in the U.K."

Switzerland, meanwhile, is "definitely on the radar screen". The company is targeting Basel for its entry, and Rego says this is "nicely located with respect to other drop-off points." Basel is situated in the north of the country bang on the borders with France and Germany.

"Once you see us in the E.U., you'll see us darting around very quickly," Rego said.

The rollout in Canada, which included preparing a Web site and customer services in French, took less than a few months, he noted.

Overall, Rego sees opportunities as broadband becomes available through more technologies, including power lines or Wimax, which gives high-speed access with a longer range than the WI-Fi technology being deployed in places like airport lounges or hotels.

"Over the next 18 months, there will be myriad places to buy your broadband," he said.

With more companies exploiting Voip, there will be a "little pressure" on pricing, making products key. But with more bandwidth, there's no reason why the likes of Vonage shouldn't offer video phones in the next 18 months to 2 years, he added.

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