Still Holding On? Lets discuss

Posts: 1123 · Vonage Forum **MVM** Joined: May 26, 2005 Posts: 1123

They are NOT portable in any way. That is a downfall. I think they do offer business class service, but not saure of the specifics. I know I don't care about the portability anymore, since my company furnished me with a cell and laptop. But I can see the benefit to haveing that portability. That's one thing the cable companies might need to think about as an add-on to service. Vonage does have that going for them.

Posts: 111 · Vonage Forum Senior Joined: Jun 15, 2006 Posts: 111

Regarding pricing, the CableCo's are not going to keep charging 30-40. Verizon just cut their price from 35 to 25, plus free activation. In other words, cheaper than Vonage.

Vonage in May started to offer free calls to much of Europe. They were making revenue off those calls, now they are not. Maybe they will get new customers because of this promotion, but they lose money on every customer.

See this article:
http://www.businessweek.com/technology/content/may2006/tc20060504_327191.htm?chan=technology_technology+index+page_today's+top+stories

I suggests that VoIP will soon be free. More likely, in my opinion, the CableCo's will just charge an extra 4.99 to 9.99, just a small little charge nobody thinks about like the price of HBO.

Posts: 94 · Vonage Forum Senior Joined: Jun 17, 2006 Posts: 94

It is possible for them to charge $5 or $10, but I doubt they would take a loss and damage their share price just to battle Vonage.

Verizon or Bellsouth might become very aggressive with pricing, because they are really getting hurt and will continue to lose customers if they don't do something.

Vonage, however,continues to be the prize. They have almost 2MM customers on a national basis and nobody on a national basis will be able to catch up without losing a lot of money. In this business : Getting customers = spending money.

In the end, I wouln't be surprised if a major telecom steps in and buys Vonage's customer base (Once it gets to 5MM customers). It might be cheaper and more palatable to their shareholders to get customers that way. Companies that are a natural fit are AT&T and (crazy as it sounds )Verizon.

5MM customers is about $400 per customer at $17 per share. At $8.50 those customers come out to $200. Any VOIP provider would gladly buy customers at $200. We'll see.

Posts: 111 · Vonage Forum Senior Joined: Jun 15, 2006 Posts: 111

I don't agree that Vonage will ever have five million customers. In fact I am quite sure it will never happen. They might go from 1.6M now to 2.4 at the end of the year, but they will be bankrupt within 12 months.

Even if the Vonage name is so valuable (doubtful), it is much easier to buy the name and the customer base after bankruptcy. Right now the company is toxic. If a Comcast were to buy it now, they would be accepting all of VG's legal liabilities.

Furthermore, if there were any real interest in taking over Vonage, they could have bought shares for under $3. Just a few months ago that was the price they were being sold at.

I don't agree a VoIP customer is worth $200. The future of IP is either free or a nominal $5 or $10.

Finally, cable companies have no desire to have VoIP customers in other company's territories.

Posts: 493 · Vonage Forum Evangelist Joined: Apr 29, 2005 Posts: 493

BigTime wrote:

Furthermore, if there were any real interest in taking over Vonage, they could have bought shares for under $3. Just a few months ago that was the price they were being sold at.

When were shares under $3?

Posts: 111 · Vonage Forum Senior Joined: Jun 15, 2006 Posts: 111

Before the IPO, when vonage needed money to cover its losses it sold shares to various organizations. These are called private placements.

The last one was for 70.3 million shares for 200 million dollars, or 2.84 a share. Just two years ago you could get Vonage stock for 80 cents.

All of these guys of course will be happy to sell for $4 and still make a handsome profit. And they will as soon as the 180-day lockup period is over and they are allowed to sell their shares.

Posts: 1123 · Vonage Forum **MVM** Joined: May 26, 2005 Posts: 1123

What if it drops below 2.85 a share though? I ask because I am market-stupid. Wouldn't that mean that they take a loss?

Posts: 2135 · Posted: Mon Jun 19, 2006 9:42 pm Post subject:

This is not directed at the last poster or any other poster in general...
however the original poster asked specifically to keep this thread on topic and I would to grant him that respect.

Many of the questions asked here are valid ones that may just require a new thread, so please feel free to start a new thread with your questions.

Thank you,

Posts: 88 · Posted: Thu Jul 06, 2006 10:21 am Post subject:

dconnor wrote:

I am holding and looking forward to the end of the silent period.

Now what are you looking forward to?

Posts: 6 · Posted: Thu Jul 06, 2006 2:09 pm Post subject:

I am holding and looking foI'moptimistic- it's going up!