Vonage has settled its long running lawsuit with Verizon. Vonage has agreed to pay Verizon 120 million to settle the dispute involving Vonage’s use of Verizon’s patented technology for making phone calls over the Internet.
Vonage has settled 3 such lawsuits in recent months. Vonage still has one lawsuit pending with AT&T over similar issues.
The lawsuits have created tremendous anxiety for Vonage customers who were worried that Vonage could go out of business. Despite being the leading pure Internet phone carrier with over 2.5 million subscribers, Vonage was extremely vulnerable to large damage awards in the lawsuits. This past summer another VoIP carrier, SunRocket, suddenly shut down operations.
It’s impossible to say how many customers left Vonage or how many never signed up at all because of the lawsuits, but Vonage customers should feel much better about the carrier’s long term prospects. Vonage still faces many challenges from cable companies, telcos, customers going wireless only, and other VoIP carriers, but things are looking much brighter now that Vonage’s biggest problems are in the marketplace and not the courtroom.
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