Vonage
   HOME

TheInfoList



OR:

Vonage (, legal name Vonage Holdings Corp.) is an American cloud communications provider operating as a subsidiary of
Ericsson (lit. "Telephone Stock Company of LM Ericsson"), commonly known as Ericsson, is a Swedish multinational networking and telecommunications company headquartered in Stockholm. The company sells infrastructure, software, and services in informat ...
. Headquartered in
Holmdel Township, New Jersey Holmdel Township (usually shortened to Holmdel) is a township in Monmouth County, New Jersey, United States. The township is centrally located in the Raritan Valley region, being within the regional and cultural influence of the Raritan Baysh ...
, the organization was founded in 1998 as ''Min-X'' as a provider of residential telecommunications services based on
voice over Internet Protocol Voice over Internet Protocol (VoIP), also called IP telephony, is a method and group of technologies for the delivery of voice communications and multimedia sessions over Internet Protocol (IP) networks, such as the Internet. The terms Internet t ...
(VoIP). In 2001, the organization changed its name to Vonage. As of 2020, Vonage reported consolidated revenues of $1.25 billion. Through a series of acquisitions beginning in 2013, Vonage, previously a consumer-focused service provider, has expanded its presence in the business-to-business marketplace, while still keeping its home VOIP service. Vonage's offering includes unified communications, contact center applications and communications APIs. In July 2022, Ericsson completed its acquisition of Vonage for $6.2 billion.


History

Min-X.com was founded by
Jeff Pulver Jeff Pulver is an American Internet entrepreneur and futurist known for his work as an innovator in the field of Voice over Internet Protocol (VoIP). Pulver's early work in VoIP with his company Free World Dialup led to a significant regulatory ...
in 1998 as a
Voice over IP Voice over Internet Protocol (VoIP), also called IP telephony, is a method and group of technologies for the delivery of speech, voice communications and multimedia sessions over Internet Protocol (IP) networks, such as the Internet. The terms In ...
(VOIP) exchange. He recruited Jeffrey A. Citron and Carlos Bhola, who each invested $1 million and joined as board members. Citron and Bhola then raised approximately $11 million in additional funding, pivoted the company to being a VOIP service provider, and Citron took over as CEO and Bhola as President. The company changed its name to Vonage Holdings Corp. in 2001.
Filing detail page
/ref> When the name was changed the company was located in
Edison, New Jersey Edison is a township located in Middlesex County,in the U.S. state of New Jersey. Situated in Central New Jersey within the core of the state's Raritan Valley region, Edison is a commercial hub, home to Menlo Park Mall and Little India. It is ...
. In 2005, the organization relocated its headquarters to Holmdel, New Jersey. Pulver left the company in 2002 to start another VOIP venture. The company first offered subscription service in the
United States The United States of America (U.S.A. or USA), commonly known as the United States (U.S. or US) or America, is a country primarily located in North America. It consists of 50 states, a federal district, five major unincorporated territorie ...
, then expanded to
Canada Canada is a country in North America. Its ten provinces and three territories extend from the Atlantic Ocean to the Pacific Ocean and northward into the Arctic Ocean, covering over , making it the world's second-largest country by tot ...
in 2004 and the
United Kingdom The United Kingdom of Great Britain and Northern Ireland, commonly known as the United Kingdom (UK) or Britain, is a country in Europe, off the north-western coast of the continental mainland. It comprises England, Scotland, Wales and North ...
in 2005. Vonage went public on May 24, 2006.Vonage Investor Relations FAQs
Vonage.com


Initial public offering

In 2006, in preparation for an initial public offering, Michael Snyder, former president of
ADT Security Services ADT Inc., formerly The ADT Corporation, is an American company that provides residential, small and large business electronic security, fire protection, and other related alarm monitoring services throughout the United States. The corporate hea ...
replaced Vonage co-founder Citron as the organization's CEO. Citron could not preside over the
IPO An initial public offering (IPO) or stock launch is a public offering in which shares of a company are sold to institutional investors and usually also to retail (individual) investors. An IPO is typically underwritten by one or more investment ...
because he was permanently barred from associating with any securities brokers or dealers. In 2007, in a restructuring effort to reduce ongoing net losses in the face of double-digit stock price slips and patent infringement issues, Snyder resigned, and Citron returned as interim CEO. The company announced plans for 10% layoffs as it secured $215 million in financing. Vonage offered shares of its stock to its existing customer base in the period before the initial public offering. Under normal circumstances, only large institutional investors such as banks are able to buy shares of an IPO. Vonage's initial public offering occurred on the
New York Stock Exchange The New York Stock Exchange (NYSE, nicknamed "The Big Board") is an American stock exchange in the Financial District of Lower Manhattan in New York City. It is by far the world's largest stock exchange by market capitalization of its listed c ...
on May 24, 2006, opening at $17 per share. The price closed at $14.85, a decrease of 12.7 percent, the worst trading day for any IPO in 2006 up to that point. The IPO raised $531 million for the company. However, the existing customers who lost money filed a
class action A class action, also known as a class-action lawsuit, class suit, or representative action, is a type of lawsuit where one of the parties is a group of people who are represented collectively by a member or members of that group. The class actio ...
lawsuit. The IPO and its immediate aftermath also earned Vonage a ''
Business 2.0 ''Business 2.0'' was a monthly magazine publication founded by magazine entrepreneur Chris Anderson, Mark Gross, and journalist James Daly in order to chronicle the rise of the " New Economy". First published in July 1998, the magazine was sold ...
'' Magazine award as 14th of 101 Dumbest Moments in Business for 2006. In 2009, Vonage reached an agreement with the IPO investors. All shareholder claims against Vonage and its individual directors and officers who were named as defendants were dismissed. The amount of the settlement, $3.6 million, was paid by an insurance policy covering the directors and officers of the company. The firms underwriting the IPO,
Citigroup Citigroup Inc. or Citi (Style (visual arts), stylized as citi) is an American multinational investment banking, investment bank and financial services corporation headquartered in New York City. The company was formed by the merger of banking ...
,
UBS UBS Group AG is a multinational Investment banking, investment bank and financial services company founded and based in Switzerland. Co-headquartered in the cities of Zürich and Basel, it maintains a presence in all major financial centres ...
, and
Deutsche Bank Deutsche Bank AG (), sometimes referred to simply as Deutsche, is a German multinational investment bank and financial services company headquartered in Frankfurt, Germany, and dual-listed on the Frankfurt Stock Exchange and the New York Sto ...
, were fined a total of $845,000 and ordered to reimburse customers for "failure to adequately supervise communications" with investors. NYSE regulators went so far as to investigate possible short-selling."Citi, UBS, Deutsche Bank fined over Vonage IPO"
Reuters.com. September 22, 2009.


Acquisitions

Beginning in 2013, Vonage acquired several companies as it refocused its business from a home phone provider to a global business cloud communications provider, including: * Vocalocity, a
software as a service Software as a service (SaaS ) is a software licensing and delivery model in which software is licensed on a subscription basis and is centrally hosted. SaaS is also known as "on-demand software" and Web-based/Web-hosted software. SaaS is con ...
(SaaS) provider of cloud-based communications services, for $130 million; *
Telesphere Telesphere is a nationwide Unified Communications as a Service provider for businesses. In 2003 Telesphere began providing highly secure cloud-based voice and data services over a private IP MPLS network to mid and large enterprises throughout the U ...
, a unified communications as a service (UCaaS) provider to large companies, for $114 million; *
iCore Networks iCore Networks is an American network as a service provider with headquarters in McLean, Virginia. It specializes in platforms for VoIP networks. Founded in 2001, the company is known as the largest hosted unified applications and communications ...
, also a UCSaaS provider to large companies, for $92 million; * SimpleSignal, another UCSaaS service provider to small and medium-sized businesses, for $25 million; * , also a cloud-based communications service provider to businesses (price not disclosed). * Nexmo, the 2nd largest CPaaS company, for $250 million; * TokBox, a
WebRTC WebRTC (Web Real-Time Communication) is a free and open-source project providing web browsers and mobile applications with real-time communication (RTC) via application programming interfaces (APIs). It allows audio and video communication to wor ...
programmable video provider, for $35 million. *NewVoiceMedia, a Contact Center as a Service (CCaaS) provider, for $350 million *Over.ai, a Voice and Conversational AI provider for enterprise communications


Acquisition by Ericsson

On 22 November 2021, it was announced that Vonage would be acquired by
Ericsson (lit. "Telephone Stock Company of LM Ericsson"), commonly known as Ericsson, is a Swedish multinational networking and telecommunications company headquartered in Stockholm. The company sells infrastructure, software, and services in informat ...
in a US$6.2 billion all-cash purchase. The acquisition completed on 21 July 2022. According to the press release, Ericsson will acquire all of Vonage's outstanding shares at an all-cash price of US$21 per share, a 28% premium. The acquisition will be financed through Ericsson’s existing cash resources, which amounted to SEK 88 billion as of 30 September 2021 on a gross basis, and SEK 56 billion on a net basis as of the same date. Vonage will then become a wholly owned subsidiary of Ericsson but will continue to operate under its existing name and be reported as a separate segment in Ericsson accounts. Vonage's employees will remain with the company and the Vonage CEO
Rory Read Rory P. Read is an American business executive. He is the CEO of Vonage, a position he assumed on July 1, 2020. He previously served as EVP chief operating executive at Dell as well as president and CEO of Virtustream. He was formerly the chief ...
will join the Executive Team of Ericsson, reporting to CEO,
Börje Ekholm Börje Ekholm (born 1963) is a Swedish business executive who is the chief executive officer of Ericsson, and has been since January 16, 2017. Prior to his appointment, he was chief executive officer of Patricia Industries, and from 2005 to 2015 h ...
.


Patent infringement lawsuits

On June 19, 2006,
Verizon Verizon Communications Inc., commonly known as Verizon, is an American multinational telecommunications conglomerate and a corporate component of the Dow Jones Industrial Average. The company is headquartered at 1095 Avenue of the Americas in ...
filed a lawsuit alleging that Vonage infringed on five of Verizon's
patent A patent is a type of intellectual property that gives its owner the legal right to exclude others from making, using, or selling an invention for a limited period of time in exchange for publishing an enabling disclosure of the invention."A p ...
s related to its
VoIP Voice over Internet Protocol (VoIP), also called IP telephony, is a method and group of technologies for the delivery of voice communications and multimedia sessions over Internet Protocol (IP) networks, such as the Internet. The terms Internet t ...
service. The patents describe technology for completing phone calls between VoIP users and people using phones on the traditional public switched network, authenticating VoIP callers, validating VoIP callers' accounts, fraud protection, providing enhanced features, using Wi-Fi handsets with VoIP services, and monitoring VoIP caller usage. In 2007, Vonage launched a
viral marketing Viral marketing is a business strategy that uses existing social networks to promote a product mainly on various social media platforms. Its name refers to how consumers spread information about a product with other people, much in the same way tha ...
campaign and website freetocompete.com, which garnered press coverage about Vonage, its campaign, the lawsuits, and issues of competition with established telecom corporations. On March 8, 2007, a jury found Vonage liable for infringing three patents held by Verizon, and but found no infringement as to two other patents. The jury returned a verdict against Vonage for $58 million and included a royalty rate of 5.5% of every sale to a Vonage customer to Verizon. Subsequent to this jury award, there were a series of appeals and intermediate stays on payment. Vonage was also ordered by the court to stop signing up new customers, but this was stayed pending appeal three weeks later. On November 19, 2007, Vonage agreed to pay $120 million in damages to Verizon. In other patent lawsuits, by December 2007, Vonage was ordered to pay $80 million to
Sprint Nextel Sprint Corporation was an American telecommunications company. Before it merged with T-Mobile US on April 1, 2020, it was the fourth-largest mobile network operator in the United States, serving 54.3 million customers as of June 30, 2019. The co ...
and $39 million to AT&T Inc. Another lawsuit with
Nortel Nortel Networks Corporation (Nortel), formerly Northern Telecom Limited, was a Canadian multinational telecommunications and data networking equipment manufacturer headquartered in Ottawa, Ontario, Canada. It was founded in Montreal, Quebec, ...
resulted in no monetary damages.


2009 customer service settlement

In November 2009, Vonage agreed to an
assurance of voluntary compliance In law of the United States, American law, an assurance of voluntary compliance is a legal device entered into between a state attorney general and an individual or business that the attorney general believes has or may in the future violate a consu ...
(AVC) with 32 states. The settlement followed an investigation into complaints about the marketing of Vonage services, including confusion about availability and cost, along with advertisements involving "free" services, money back guarantees and trial periods. The consumer protection agreement also addressed complaints that some consumers were prevented from canceling the Vonage service. In the settlement, Vonage agreed to pay the seven investigating states $3 million for costs, issue refunds to complainants dating back to January 2004, and change several business practices in regard to advertising and customer retention.


Services

Originally known for its home VOIP services, Vonage has shifted its primary focus to business cloud communications in the mid 2010s. Vonage offers cloud communications and calling plans for residential customers and businesses, including small and medium-sized businesses, mid-market companies, and enterprises.


Business services

Vonage offers two
unified communications Unified communications (UC) is a business and marketing concept describing the integration of enterprise communication services such as instant messaging (chat), presence information, voice (including IP telephony), mobility features (including e ...
platforms for businesses that integrate communications services, such as video conferencing, voicemail transcription, and desktop sharing, using voice as a platform.
Cloud communications Cloud communications are Internet-based voice and data communications where telecommunications applications, switching and storage are hosted by a third-party outside of the organization using them, and they are accessed over the public Internet. C ...
services allow business customers to connect with various business applications and
customer relationship management Customer relationship management (CRM) is a process in which a business or other organization administers its interactions with customers, typically using data analysis to study large amounts of information. CRM systems compile data from a ra ...
(CRM) tools through a
middleware Middleware is a type of computer software that provides services to software applications beyond those available from the operating system. It can be described as "software glue". Middleware makes it easier for software developers to implement co ...
technology. For business customers that rely on high quantities of voice, video and data communications in their day-to-day operations, Vonage provides
quality of service Quality of service (QoS) is the description or measurement of the overall performance of a service, such as a telephony or computer network, or a cloud computing service, particularly the performance seen by the users of the network. To quantitat ...
over its own private
Multiprotocol Label Switching Multiprotocol Label Switching (MPLS) is a routing technique in telecommunications networks that directs data from one node to the next based on labels rather than network addresses. Whereas network addresses identify endpoints the labels identif ...
(MPLS) network and via a Software Defined Area Network (SD-WAN) product.


Residential services

Residential services provide home phone plans using
VoIP Voice over Internet Protocol (VoIP), also called IP telephony, is a method and group of technologies for the delivery of voice communications and multimedia sessions over Internet Protocol (IP) networks, such as the Internet. The terms Internet t ...
(voice over Internet Protocol) over a broadband Internet connection, such as cable Internet service or DSL. Features for Vonage home phone residential service includes voicemail transcription; 411 calling; caller ID; call waiting; do not disturb; and a network availability feature which forwards all calls to a mobile phone if Internet connectivity is lost. Many of Vonage's residential products offer international calling plans.


Service requirements

Vonage customers must have a broadband Internet connection, such as cable Internet service or DSL, through an
Internet service provider An Internet service provider (ISP) is an organization that provides services for accessing, using, or participating in the Internet. ISPs can be organized in various forms, such as commercial, community-owned, non-profit, or otherwise private ...
(ISP). To initiate subscription a customer must provide a billing and shipping address in the country of service. Vonage supplies an
analog telephone adapter An analog telephone adapter (ATA) is a device for connecting traditional analog telephones, fax machines, and similar customer-premises devices to a digital telephone system or a voice over IP telephony network. An ATA is often built into a sma ...
which connects a customer supplied standard analog telephone to the Internet and the Vonage service. Residents of the U.S., Canada, and the UK may subscribe to Vonage by credit card from their respective country, but the Vonage adapter can be connected to the Internet anywhere. Usage is generally referred to as "unlimited", though Vonage has different national "fair use" policies limiting Vonage-to-phone calls to a few thousand minutes per month in the UK, Canada, and U.S. Evidence suggests that calls are limited to a length of 3 hours and 56 minutes.


Telephone number availability

Subscribers may choose a number in the country of the service they subscribe to for their primary line, in an
area code A telephone numbering plan is a type of numbering scheme used in telecommunication to assign telephone numbers to subscriber telephones or other telephony endpoints. Telephone numbers are the addresses of participants in a telephone network, rea ...
of their choice. Subscribers can obtain additional "virtual numbers" for a monthly fee. Vonage also offers virtual numbers in
Mexico Mexico (Spanish: México), officially the United Mexican States, is a country in the southern portion of North America. It is bordered to the north by the United States; to the south and west by the Pacific Ocean; to the southeast by Guatema ...
, Canada and
Europe Europe is a large peninsula conventionally considered a continent in its own right because of its great physical size and the weight of its history and traditions. Europe is also considered a Continent#Subcontinents, subcontinent of Eurasia ...
. While the company supports porting a U.S. telephone number via the FCC's
local number portability Local number portability (LNP) for fixed lines, and full mobile number portability (FMNP) for mobile phone lines, refers to the ability of a "customer of record" of an existing fixed-line or mobile telephone number assigned by a local exchange ca ...
(LNP), not every phone number is available in every area code. Additionally, customers can transfer an existing number to Vonage, which can take up to 7 to 10 business days from the time the customer completes the Number Transfer Authorization (NTA).


Emergency calls

Vonage offered 911 service on a VoIP platform for the first time in 2003. For 911 location services to work, subscribers must activate the 911 calling feature by registering their full address with the company. Customers are responsible for maintaining their 911 location information at all times. If a customer dials 911 before the 911 verification is completed, the call will usually be routed to a national 911 call center where basic information must be given (name, location, nature of emergency, etc.), after which the call is transferred to a local public service answering point, like a local Police Department.


Quality of service and equipment compatibility

VoIP service relies upon consistent broadband-ISP uptime and VoIP-equipment compatibility with the ISP's modem. Although VoIP was initially optimized for voice, some
fax Fax (short for facsimile), sometimes called telecopying or telefax (the latter short for telefacsimile), is the telephonic transmission of scanned printed material (both text and images), normally to a telephone number connected to a printer o ...
equipment can be operated over VoIP, but compatibility of monitored alarm systems and other devices is less certain. Vonage offers "specially commissioned" ''Fax Line'' service. Vonage recommends customers keep a basic traditional landline dedicated to their home alarm system and use Vonage for the rest of their calling needs. Vonage implements
Voice over IP Voice over Internet Protocol (VoIP), also called IP telephony, is a method and group of technologies for the delivery of speech, voice communications and multimedia sessions over Internet Protocol (IP) networks, such as the Internet. The terms In ...
sending audio via RTP and signaling via SIP.


See also

* '' Kleffman v. Vonage Holdings Corp.'' *
List of VOIP companies is a list of notable companies providing voice over Internet Protocol (VoIP) services. {, class="wikitable sortable" , - ! Company !! Base of operations !! Country !! Services provided , - , EMAXX , , Concord, Ontario , , Canada , , A-Z v ...


References


External links

* {{authority control 2001 establishments in New Jersey 2006 initial public offerings 2022 mergers and acquisitions American companies established in 2001 American subsidiaries of foreign companies Companies based in Monmouth County, New Jersey Companies formerly listed on the New York Stock Exchange Companies formerly listed on the Nasdaq Ericsson Holmdel Township, New Jersey Telecommunications companies established in 2001 VoIP companies of the United States VoIP software