Sunday, March 6, 2005

VON Keynote: 500,000 Vonage Lines and Counting

Vonage has exceeded 500,000 total lines in service and is now "on a quick and easy march" to its first million users, said Jeffrey Citron, CEO, Vonage, in a keynote address at Spring VON in San Jose. Vonage is adding 15,000 users per week and expects to end Q1 with over 600,000 users. It claims to have a leading 35% share of the U.S. residential VoIP business, with its nearest competitors being Cablevision and Time Warner. Citron believes Vonage, as a pure play VoIP providers, will keep ahead of cable competitors even as Comcast enters the market later this year.

Looking ahead, Vonage will continue to seek growth through its heavy advertising campaigns, through expanded retail channels (already 20% of new sign-ups come through retail partners), and through expanded CPE gear. Citron showed photos of new products from several manufacturers, including a Linksys Wi-Fi router, a cordless VoIP phone system from Vtech, and a Wi-Fi phone from UTStarcom. Later this year, Vonage will begin adding video to its service. The company also looks to expand its SOHO offering to serve companies with up to 24 lines.

On the regulatory front, Citron sees more battles ahead. A number of states, including New York, California and Ohio, have indicated they plan to challenge the FCC order asserting federal jurisdiction of VoIP. Citron is also looking for regulatory help in local number portability, noting that while it only takes 4 hours for a number to be ported from one wireless carrier to another, it can take up to 20 days in some areas for a POTS landline to be ported to Vonage.


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