Vonage Owes Over $200M

I have either been living under a rock for the past few months, or just simply can't keep up with all of the industry news. Just yesterday, it was brought to my attention that VoIP provider Vonage is tied up in a legal battle with Verizon over three alleged patent infringements. After appeals, the latest news is that Verizon Wireless won the case, and Vonage has to pay a grand total of US$120 million to the wireless phone provider. Ouch.

What makes the situation even worse for Vonage is that the company recently settled two other litigation cases with AT&T and Sprint. On October 8, Vonage settled a suit with Sprint in relation to six patents in its "voice over packet patent portfolio." Vonage was to pay Spring a total of US$80 million to cover licensing for past and future use of the technology. A few weeks later, Vonage settled a dispute with AT&T over "packet telephone system" patent infringements, leading to a payment of US$35 million over the next five years.

Basic math would indicate to me that the company might just be in a tad bit of trouble. Vonage's just-released Q3 2007 results report just US$211 million in total revenue.

It's a shame, because I really think we need more competition in the telephones arena, whether it be landline, Internet, or wireless, not less. I tried out the Vonage service in its early days, and thoroughly enjoyed using it. It was simple, convenient, and compared to a "regular" home phone plan, much, much cheaper. Customers who often make long distance, and even international, phone calls, will especially save tons of cash by jumping on the VoIP bandwagon. Of course, like any other service, it does have drawbacks: the most obvious is that, if your broadband Internet connection goes down, so will your phone. But with 70%+ wireless phone penetration in Canada, and broadband services becoming more reliable by the minute, this probably isn't such a huge deal. Hopefully Vonage will pull through, and come out with some great, new offerings in 2008! VoIP could very well be the way of the future in voice communication, and the more options the consumer has, the better.

iPhone Hacked

It was only a matter of time: as if like clockwork, a group of hackers have reportedly cracked the iPhone, and figured out how to use it on networks other than At&T: the network it should exclusively operate. I’m surprised it took them this long!

The difference between this method of hacking into the device and others reported on the ‘net over the past few weeks, is that the process is reportedly very quick, and does not require highly technical operations to complete. "No need to open your phone. No need to solder," says the Website. The group, named iPhoneSIMfree.com, claims that all that’s required is to install the developed software on the iPhone, and it should function on other carrier networks. According to the site, individual, per license units will be available starting next week.

This is big news for consumers north of the border who have been patiently waiting to get their hands on the “revolutionary” device: the iPhone is currently not available in Canada, or any other country but the U.S., for that matter.

Of course we'd like to think that most consumers will wait until the iPhone is legitimately available in their country. As for Canada, although no official launch date has been announced, all signs point to Mr. Rogers being the likely partner. And the sooner this happens, the less hacking we, and Apple, will have to endure.