VoIP Provider Vonage Planning IPO? 143
SixDimensionalArray writes "The
rumor mill is exploding with stories that large voice-over-ip (VoIP) provider Vonage is planning an initial public offering to raise nearly $600 million. This information is interesting coming out not long after Google's recent release of Google Talk, which overs instant messaging/VoIP services PC-to-PC as well as a surge in marketing by VoIP providers such as Covad and Skype. Could this be yet another bubble?"
Maybe they need the money to get some engineers... (Score:1, Flamebait)
Re:Maybe they need the money to get some engineers (Score:2)
Re:Maybe they need the money to get some engineers (Score:1)
Re:Maybe they need the money to get some engineers (Score:2)
Re:Maybe they need the money to get some engineers (Score:2)
Is VoIP Reall That Big? (Score:4, Interesting)
Re:Is VoIP Reall That Big? (Score:2)
Re:Is VoIP Reall That Big? (Score:2)
Re:Is VoIP Reall That Big? (Score:3, Insightful)
Re:Is VoIP Reall That Big? (Score:1, Insightful)
They don't get great reception everywhere, and you can't have multiple handsets with the same number.
I pay $16.94 a month for Vonage, and that is my only phone. I use about 100 minutes paid and 100 minutes free.
VoIP software is a joke. I need a phone that my credit card company, or car repair shop can call, and need to be able to call them for whatever reason.
Re:Is VoIP Reall That Big? (Score:5, Interesting)
Re:Is VoIP Reall That Big? (Score:3, Informative)
In a way this make sense for them, as there really is no need for a middleman like Vonage for direct VOIP calls, but as more people get VOIP they are going to want to make VOIP calls without paying a middleman. I already do.
Re:Is VoIP Reall That Big? (Score:2, Interesting)
Re:Is VoIP Reall That Big? (Score:2, Redundant)
Re:Is VoIP Reall That Big? (Score:2)
Over time people may come to realize the simplicity of the service Vonage is actually providing. Nevertheless, they are providing a necessary service. You can say its akin to dynamicDNS. But it works, it works well, and they are not gouging. Plus E911 may actually become a strength of a service like Vonage.
I think they have lots of methods to make themselves usefull to the public.
The bigest proble
Direct calls (Score:1)
Re:Is VoIP Reall That Big? (Score:2)
Re:Is VoIP Reall That Big? (Score:2)
No, all Vonage would have to do is quit locking down their customers' SIP boxes, so they could accept incoming connections from wherever. Vonage would not have to support non-Vonage calls in any way, they just need to get out of the way.
Of course you can already receive VOIP calls without Vonage (or any other "provider") using a separate SIP box, but you'd rather not have to answer a different ph
Re:Is VoIP Reall That Big? (Score:3, Interesting)
It's VoIP for people who don't want VoIP. It plugs in between your phone and the POTS line, with an Ethernet cord shoved in another port. When you dial a number it checks to see if that number is SIP or PSTN. If it's SIP, it sends the call over the Internet for free. If not, it goes over the traditional phone line. It works when the power's off, 911 is still the same, and you can set it to route all long distance calls over a VoIP long distance provider for 1.5/min.
There's a referral
Re:Is VoIP Reall That Big? (Score:2)
Except for the fact that a simple POTS line with long distance can cost upwards of $70 a month. Thats why I use VoIP. When I moved a year ago, I looked into it, and found out I could get Vonage and a cell phone for what SBC wanted for me to get a phone with the monthly long distance minutes still on top of that.
Re:Is VoIP Reall That Big? (Score:2)
Re:Is VoIP Reall That Big? (Score:2)
The pay phones in my area were set up so that the caller could hear the other end but they could not here until you paid. So I'd call the folks, they'd answer, and know it was me when there was silence. :)
Re:Is VoIP Reall That Big? (Score:2, Insightful)
As a small business owner, I can say that Skype and other VOIP services have been a godsend and I welcome Google to the game.
We have employees in China, Australia, England, and the United States, who all talk for free on Skype. In addition, I have 3 SkypeIn phone numbers: One in China, one in England, and one in the United Sta
Re:Is VoIP Reall That Big? (Score:2)
Cell phones?? (Score:2)
Now take vonage, A company of their position is doing well to go with an IPO just for the publicity. With the success of google major news organizations will cover the IPO story and vonage gets free advertising.
An IPO may or may not be a good thing for users of their service (come to think of it I cant see how it could be go
Re:Is VoIP Reall That Big? (Score:2, Interesting)
Lots of money to be made (Score:4, Insightful)
Deregulation (Score:1)
I wuv vonage (Score:2, Funny)
--
http://stoopidme.org/ [stoopidme.org]
Bringing the world together through our common bond: our stupidity
Re:I wuv vonage (Score:2)
Vonage has multiple pricing platforms,
Re:I wuv vonage (Score:2)
Re:I wuv vonage (Score:2)
Re:I wuv vonage (Score:2)
Thats a savings of over 50%.
Re:I wuv vonage (Score:2)
I hope it is true (Score:4, Funny)
Exploding Rumor Mill? (Score:3, Funny)
What's that you say? Oh, this is Slashdot?
Ah, never mind then. Nothing for you to see here, please move along.
Re:Exploding Rumor Mill? (Score:2)
TechCom and the future (Score:5, Interesting)
He said they refer to technologies like VoIP as "TechCom" and fully expect it to replace Telecom as time goes on - and the market of incompatable technologies is just because the technology is in it's infancy [VHS vs Beta, Laserdisk, VCD, DVD, Blu-ray vs HD-DVD would make a string of good examples] and that overtime they'll eventually all become cross-compatable.
He pointed out previous advances in communications technology anymore - specifical AT&T - anyone remember what the second T is? American Telephone and Telegraph - who uses a Telegraph anymore? Exactly: NOBODY.
VoIP is the infancy of the next generation of communications technology - not a bubble.
Re:TechCom and the future (Score:2)
Re:TechCom and the future (Score:3, Insightful)
I wouldn't get out the doomsday hats for the telecom companies yet, they'll adapt as always.
Re:TechCom and the future (Score:4, Insightful)
When people speculate on whether VOIP will become a bubble in this context, I think it's referring more to the over-valuation of the stock at IPO.
I don't think anyone argues that VOIP technology isn't the future of communications, though, and may be worthy of long-term investment.
Deregulation could make this interesting. (Score:1)
Re:TechCom and the future (Score:2)
Actually... "Some companies, like Western Union and Swedish Telia still delivers Telegrams, but they serve as nostalgic novelty items rather than a primary means of communication." http://en.wikipedia.org/wiki/Telegraphy#Telex [wikipedia.org]
So some day, we may get an old fashioned phone call as a novelty gift.
I think that in order to invest, one would want to know which technology is going to win out, but also, which company is in the best position to exploit the market.
Re:TechCom and the future (Score:2)
As VoIP services like Vonage become more common, we'll see traditional phone networks be phased out; either thin copper phone -> VoIP over cable, or thin copper phone -> VoIP over thin copper DSL as a transition to fiber.
Telegrams require an order of magnitude less wiring. While phone lines probably won't be ripped out for awhile, y
I would have to agree with you. (Score:1)
Re:TechCom and the future (Score:1)
We can expand that further. Who uses AT&T anymore? Exactly: NOBODY.
Vonage bubble? (Score:2)
Generally, we say a companies value should be about 10x its annual revenue.
So, with Vonage having 800,000 subscribers (FTA) at about $30/month (based on my bill) we get $24,000,000/month or $288,000,000/year.
This would indicate that their value should get up to over 2.88 billion dollars.
Now, take their really low operating overhead and add the tech dotcom bubble effect, they'll probably end up worth 100 times that
Certainly a bubble (Score:4, Insightful)
They can easily convert everyone to unlimited plans and put the domestic LD carriers out of the voice business. There's just so much profit to be milked out of $.25/min in-state calling that it's hard to justify dropping the prices since people are willing to pay it.
Vonage and others will face the same challenge others have seen when fighting the ILECs.
Re:Certainly a bubble (Score:1, Flamebait)
Sure, many people get their internet access through phone company DSL, but it isn't so easy for phone companies to screw with it. In the United States, if a phone or cable company decided to block Vonage and only allow their own digital phone s
Re:Certainly a bubble (Score:2)
Vonage works just fine over cable, or fiber, or whatever. (BPL? Fixed Wireless? EV-DO?)
If the phone companies go nuts, block this stuff, and raise prices, expect them to go out of business.
Plus, the baby bells will get challenges from the FCC. Michael Powell uses Vonage as his posterchild for competition in the telecom industry. I wouldn't be surprised if some of this 600 mil goes towards lobb
Re:Certainly a bubble (Score:2)
They want to raise too much, overpriced (Score:5, Interesting)
To date, the company has raised more than $400 in venture capital
They way I understand, VC will own most of the company. How much of a % ownership did the $400 million buy, and how much of a % ownership will the $600 million have? Are the VC cashing out? This is the stage of the game where they normally do. And I would like to know how much influance the VC has, did they strike a deal with the original investment that the VC has control of when the company goes IPO?
There was a great movie about how VC ruined a company, the DVD is called startup.com. Some very smart guys came up with a great idea. They did all the work, but needed funding. They found VC, and had a big party, they took all their employees on a vacation. Then they realized how much control the VC had. The VC ran the show. The VC fired one of the founders, the guy who was the technical mastermind. It was a nightmare what they did. And the company eventually went bankrupt.
This seems like a bad deal to me. As others have pointed out, cell phones are getting cheaper all the time, and now there are free VoIP services available.
I just can't see how this kind of company could get a billion dollars. It is like we are living in 1999.
Re:They want to raise too much, overpriced (Score:1)
Re:They want to raise too much, overpriced (Score:1)
One way to value a firm is discounted cash flow (DCF). $750 per customer may seem unreasonable given they are only charging $14.95 per month. But note that it's $750 for the entire lifetime of the firm. In estimating the total value of the firm, you have to take into account the FUTURE free cash flow (FCF) discounted by the cost of capital (WACC).
I'm not going to do the actual calculation here and will leave that to fellow
http://en.wikipedia.org/wiki/Discounted_cash_flow [wikipedia.org]
Re:They want to raise too much, overpriced (Score:3, Insightful)
That's assuming they develop *no more customers*, which this IPO is most likely predicated on them not doing.
The idea behind an IPO is to fuel explosive growth; an IPO is most definitely *not* a sale of company assets, and current income is only roughly related to how much money you want to raise.
Far more important is business plan; and these IPO rumors are indicative of Vonage planning to build out extensively, or to acquire customers, or both.
$750 a customer? You're thinking wrong.
800,00
they should raise their target to 90 mil customers (Score:2)
What I mean to say is that there are certain issues with evaluating a companies' IPO based upon their targets for customers instead of their actual customer list.
If you ask me, $750/customer is far too much.
The idea that an IPO is to fuel "explosive growth" is hilarious. That's
Re:They want to raise too much, overpriced (Score:2)
Probably. Most VCs exist to take the company to public and cash out at that state. They are by and large not interested in long term viability of a company and have no real desire to hold on to ownsership of companies beyond that point.
They are called VENTURE capitalists for a reason. Once a company is public it's no longer a venture. At that point you might as well buy a mutal fund.
Re:They want to raise too much, overpriced (Score:1)
Wow, I'm totally positive that you took the wrong point home from that one. The world is full of smart guys with great ideas, people so smart that they can't be bothered to spend five minutes thinking about why the solution they're proposing doesn't solve a problem people are willing to pay to solve. There were a lot of
Re:They want to raise too much, overpriced (Score:2)
As for the startup company that got "ruined" by VC -- it sounds like the guys who started the company didn't know what they were getting into. Of course the VC is going to want significant control of the company. It will all be spelled out in the V
We clearly didn't watch the same startup.com (Score:2)
Re:They want to raise too much, overpriced (Score:2)
Cue the purple [wikipedia.org].
Will pretentious questions be the end of Slashdot? (Score:5, Funny)
"Will this be the death of X?"
"Uh oh, is X's dominance in the market place over?"
You won't phrase shit like this as a statement because you know it is retarded given the unimportant news announcement preceding it. Instead you write it as a question because then you can just claim to be "provocative" instead of a "fucking moron."
Re:Will pretentious questions be the end of Slashd (Score:3, Funny)
It makes me sick how formulaic most of these stories are:
[insert unimportant story here]. [Make an absolutely outlandish jump to conclusions and ask a ridiculous rhetorical question that bears absolutely no logical connection whatsoever to either a.) the story in question or b.) any sane person's version of reality].
Example: [slashdot.org] Blah blah blah some anime company using Bittorent for distribution blah blah blah. The question is will other distributors and studios follow ADV's example or stick to their curr
Re:Will pretentious questions be the end of Slashd (Score:2)
I hate the stupid questions too, but I have a feeling the editors like them and are more likely to post a submission with them. Maybe they think it makes the site more professional sounding or something? Or maybe, if they are smart, they realize how annoying and retarded the question is, guaranteeing a lot of comments answering the question, and thus generating more page views.
That's my guess.
Criminal CEO? (Score:3, Informative)
Re:Criminal CEO? (Score:3, Informative)
My dealings with Vonage were not dissimilar. They've still never paid me what they owe me, although my credit card company successfully challenged the "cancelation fee" they charged me when I found that they didn't have local numbers in my area (despite the fact that I checked on that specifically when signing up.)
So I kinda do hope they go public--it'll be an opportunity to make more than the amount they owe me, as this has all the makings of a great short-term investment: a rapidly-growing company that'
I cancelled my Vonage over a FWD 800 call :) (Score:1)
The $10 disconnect fee in particular makes them the used-car dealers of VoIP.
I did have the pleasure of calling their 800 number to cancel using pulver's Free World Dialup, hehe.
D.
Public IPO would do more than bring capitol to Von (Score:5, Informative)
I replaced my Bell land line with Vonage almost two years ago. The service has been similar to cell phones as far as a few growing pains in the first months with packet dropping (due to my cable modem I found ou t- a replacement fixed the issues!)
But in the past year, the only complaint has been one time when I happen to be downloading some large torrents and the wife was unhappy about her phone conversation quality.
Plus it is far less expensive than a land line, and portable which allows me to vacation six states away and be reachable on my home phone line...and even better...make calls from it too.
Re:Public IPO would do more than bring capitol to (Score:2)
Get a QoS-enabled router. If you buy a Linksys WRT54G [google.com], you can install OpenWrt [openwrt.org] on it. OpenWrt basically turns it into a linux box, and gives you full control over the QoS characteristics, etc etc. Pretty cool stuff.
Re:Public IPO would do more than bring capitol to (Score:2)
Re:Public IPO would do more than bring capitol to (Score:2)
However, I purchased a login to an international index of content. In the spirit of free software, I will share it with Slashdot, and you. Besides, it seems they have a fair amount of information on this OpenWrt stuff. Some 245,000 entries in their database.
Go ahead and click here [google.com]. It'll log you in as me and you can browse, too.
Good luck!
Re:Public IPO would do more than bring capitol to (Score:2)
no no no, youve got it all wrong!
I came her to do two things, chew bubble gum ,and kick ass. And Im aaallll out of bubble gum
To this day, that is still a great movie. If you havent seen it go download a copy of "They Live". Rowdy roddy piper as an actor is just something you have to see for yourself! Horrible acting, but really a good storyline.
Pop (Score:3, Informative)
Use VOIP as the back end to cell phones... (Score:2)
On the other hand, the large telcos would probably just buy the technology directly from Cisco/Avaya etc...
Re:Use VOIP as the back end to cell phones... (Score:4, Informative)
All I can say is... (Score:2, Funny)
For God's sake, just shut the hell up!!!
Phones that can crash? No thanks (Score:4, Interesting)
Re:Phones that can crash? No thanks (Score:2)
People who have multiple lines anyway (cellphone, anyone?)
I gotta admit, when I balance "chance of heart attack and crashed phone system" vs "money I'd save", I'll go with the phone system. My BSD router's been up for 124 days now, and the only reason it's been that short is because the power went out 124 days ago . .
. . . and my house phone is a cordless phone with a wall plug that's needed for operation.
The only reas
Re:Phones that can crash? No thanks (Score:2)
Will it... (Score:1)
Re:Will it... (Score:1)
I am new to this (Score:1)
Re:I am new to this (Score:1)
Vonage has been a success for me (Score:3, Interesting)
When I switched over to Vonage, I went the porting-my-number way, which took about three weeks, which I think as industry standard at the time, and there wasn't anything that Vonage could really do about it anyway, because the ball was in Verizon's court to 'release' my number.
I really don't know what's keeping more people from switching over to VoIP. I know my enthusiasm for new technologies often gets me in a bit of a bind (as my less than pleasant experience with early-adopter Bell Atlantic DSL), but VoIP has been all plusses for me.
I'm glad Vonage is going public finally -- in these times, it's the sign of a company growing up (after all, this is the post 90s age). While I'm happy with their product, there is one more feature they could provide which would really thrill me -- allowing me to use my mobile phone to make calls over my VoIP line... make sense?
Re:Vonage has been a success for me (Score:2, Interesting)
The cheapest VoIP provider, is the least known! (Score:1)
I use http://www.voipbuster.com/ [voipbuster.com]Voipbuster to make calls and http://www.sipgate.co.uk/ [sipgate.co.uk] Sipgate to recieve
Sipgate allocate UK geographical numbers to their users accounts free of charge, with the added bonus that you can you can choose any national code, it doesn't matter where you live as long as you live in the UK.
Voipbuster offer free calls to PSTN lines at these des
Better Call... (Score:3, Funny)
Tell it like it is: Listen to the blogs (Score:2, Informative)
Re:Tell it like it is: Listen to the blogs (Score:1)
No way I'd invest... (Score:1)
VoIP makes every company vulnerable because switching is so easy. Think of it - once you've got a $VOIP_BO
Not A Big (Stock) Deal (Score:2)
Re:Not A Big (Stock) Deal (Score:2)
Geesh (Score:2)
Re:Geesh (Score:2)
Actually, it is. Skype is about being able to reach people around the globe without paying anything for it. Vonage is about replacing your local phone service with something essentially as good but less than half the price.
Uhm...no (Score:2)
2. Vonage's services are between $5 cheaper and $5 more expensive than telco local plans, depending on whether you want long distance access or not. That means there's no advantage over local telco service with Vonage.
3. With VoIP providers, long distance is charged at a far lower rate than telco providers.
4. You clearly haven't a clue what you're talking about. So stop talking.
Re:How to tell if you are a VOIP fanatic. (Score:1, Offtopic)
Re:How to tell if you are a VOIP fanatic. (Score:2)
Nay! They are completely on the side of Right! Truth! Justice! and all good Microsoft kinds of things.
Microsoft has never done any wrong thing, it's all envious smelly Linux lovers making it up.
Almost forgot... Say "hi" to mom.
Re:How to tell if you are a VOIP fanatic. (Score:1)
Re:How to tell if you are a VOIP fanatic. (Score:1)
For me, it makes sense. Even though Vonage doesn't yet have Hawaii area codes, I'm able to maintain a San Francisco phone number for my coworkers and maintain a US phone number while travelling internationally. There are numerous other features that make it truly useful.
I recently spent a month and a half in Jakarta and for 1 month of that time, I was working. I had DSL and was able to plug in my voip router and get cracking right away
Re:Stocks (Score:2)
That's the stupidest fucking thing I've heard all day (even counting the three lame "soviet russia" jokes I've come across).