Vonage Interview by Faultline

The Register in the UK has run a Faultline interview with Louis Holder of Vonage.

There are some interesting assertions in the article if you read it in total and also between the lines.

1. Vonage has a WiMax strategy or is at least giving it serious consideration.
2. Vonage thinks AT&T copied their approach. (I don’t. But I think Verizon did with VoiceWing)
3. WiFi is clearly on their road map
4. Europe’s mainland will see Vonage offering service in the future.

Here’s my take.

With 300,000 subscribers Vonage is far and away the market leader in customers. The issue remains burn rate. With 600 employees now and another 600 being added, plus all the outside contractors and suppliers Vonage is spending oodles of cash.

Second. If you notice Vonage loves to deposition AT&T. They don’t care about everyone else who is offering a comparable product or priced product, they only get concerned by CallVantage.

Third. Until they start running a managed network product offering they will not have the QoS to be a mission critical carrier which means the highly profitable SME market will not embrace them. That means they have lots of one and two line customers instead of thousands of ten to 200 line customers. This is the sweet spot for the RBOCs and companies like AT&T, Sprint and MCI who can offer the bandwidth that is managed, and then via an integrator deliver a Cisco, Nortel, Avayya or Mitel powered IP phone system.

Fourth. Vonage has not rolled out a virtual PBX product. For SME and small office customers a PBX is a requirement. They are leaving that market to others. Covad and Level3 are in this space.

It’s a good article and worth reading.