Already, much of the discussion about Vonage has turned to the company's exit strategy. That's strange for a public company, but after their rough IPO last week, not altogether surprising. New York VC kicks of the discussion, arguing that Vonage should should merge with the Earthlink, the aging ISP:
The financial press says the problem with Vonage is that it cannot point to near term profits. That is certainly a big problem.
But I think the biggeest problem with Vonage is that it can’t compete on a level playing field with its rivals, most importantly the cable companies who are offering the triple play - voice, video, and data. Bundling is a powerful marketing tool used with great success by many powerful technology, telecomm and media companies.
Earthlink is one of the oldest Internet brands. It trades at a $1.2bn market capitalization and it brings a number of key assets to the party. First, Earthlink is profitable with operating cash flow of around $180 million per year. That could go a long way to addressing the profitability issues at Vonage. Earthlink also has 1.6 million broadband internet customers and an additional 3.6 million dial-up customers, some of which will convert to become broadband customers of Earthlink (and Vonage voice) in the future. And Earthlink owns 50% of Helio, the broadband wireless MVNO started by Sky Dayton, the founder of Earthlink.But most importantly, Earthlink would get Vonage into the access business, where it has to be to compete with the cable companies who are coming after Vonage.
Earthlink, of course, has its own issues, most notably its ongoing loss of dialup customers.
Vonage has to date competed effectively by providing a voice service that rides on top of the commodity infrastructure of internet access. It is able to deliver voice without delivering the pipe. But when the competitors who have the pipe can offer the exact same thing you are currently offering, you have three choices; sell out to them, figure out how to level the playing field, or watch your customer base slowly churn over to your competitors.
If Vonage and Earthlink were to merge, I'd suggest they go after the "quadruple play" by offering access, voice, IP TV (partner with Microsoft on their IP TV effort?) and mobile (Helio). How cool would it be to have one provider for voice at home, voice on the road, access, and video?
Earthlink won't be the last company mentioned as a good partner for Vonage, any speculation on who else? Comcast? AOL? Microsoft? Let the guessing begin.
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Posted by: stephen24 | April 23, 2007 at 07:51 PM
LETTER OF BUSINESS RELATIONSHIP
We are mobile phones wholesalers.We deals on
all brands and models of mobile phones such as
Nokia,Motorola,Samsung,Sony Ericsson,Sagem,
Nextel,Sidekick II,Sprint,Ipods, Laptops, Mp3
players and many more at very cheap prices.We
are using this medium to look for buyers of
mobile phones.Do kindly reply back if you are
interested and as you do you will be glad you
do, you can reach us through our email
address: skillstech@gmail.com and
skillstech@hotmail.com
skillstech@inbox.lv
God bless.
CONTACT....Stephen pal
President.
WE ARE SELLING ALL KIND OF MOBILE PHONES SUCH
AS:
NIKIA:
Nokia n95.....$450usd
Nokia n93.....$200usd
Nokia n90.....$150usd
Nokia n91.....$160usd
Nokia N70.....$150usd
Nokia n80.....$180usd
Nokia n73.....$190usd
Nokia n71.....$160usd
Nokia n91.....$175usd
Nokia n90.....$160usd
Nokia n70.....$160usd
Nokia 8800....$190usd
Sidekick 1.......$150usd
Sidekick 2.......$170usd
Sidekick 3........$180usd
Sidekick LRG.....$200usd
NEXTEL:
NEXTEL i870......$80usd
NEXTEL i860......$100usd
NEXTEL i930......$130usd
MOTOROLA:
MOTOROLA RAZR V3..........$130usd
PINK MOTOROLA RAZR V3.....$110usd
MOTOROLA RAZR V3X.........$130usd
MOTOROLA MPX 220..........$110usd
MOTOROLA MPX 300..........$130usd
SONY ERICSSON:
SONY ERICSSON W800i.......$140usd
SONY ERICSSON w600i.......$130usd
SONY ERICSSON K700i.......$120usd
SONY ERICSSON K750i.......$140usd
GAMES:
XBOX 360............$200usd
PLAYSTATION 1.......$110usd
PLAYSTATION 2.......$200usd
PLAYSTATION 3.......$300usd
20GB iPod 20GB iPod ......................$45usd
Apple 4 GB iPod Mini Pink M9435LL/A ......$40usd
Apple 40 GB iPod photo....................$40usd
Apple 4 GB iPod Mini Silver M9160LL/A ....$40usd
Apple 60 GB iPod Photo M9830LL/A..........$60usd
Apple 60 GB iPod photo ...................$55usd
Apple 30 GB iPod Photo M9829LL/A..........$50usd
Apple 512 MB iPod Shuffle MP3 Player......$40usd
Apple 4 GB iPod Mini Blue M9436LL/A.......$45usd
Apple 2 GB iPod Nano......................$50usd
Apple 4 GB iPod Nano......................$60usd
Apple 30 GB iPod Vidoe....................$80usd
Apple 60 GB iPod Vidoe....................$100usd
Our service is within 24 hour and we get every goods bought from us deliver within 2-3 days to any of the destination in every part of the world. Any interested buyer should contact us on
Email: skillstech@gmail.com and
skillstech@hotmail.com
skillstech@inbox.lv
Thanks and God bless as you order.
Posted by: stephen | April 23, 2007 at 07:53 PM