Vonage Phone Device To Target Business Travelers By AMOL SHARMA and SHAWN YOUNG Wall Street Journal
June 28, 2006; Page B5 http://online.wsj.com/article/SB115144480536192271.html?mod=home_whats_news_us Vonage Holdings Corp., battling Internet-calling rivals such as eBay Inc.'s Skype and cable providers, is expected to unveil a plug-in device as early as today that will turn a computer into a phone. The product is Vonage's first strategic move since the company's initial public offering. Vonage shares have fallen 48% since the company's May 24 debut on the New York Stock Exchange. Vonage's new product would let users make calls using dialing software embedded on a memory drive that can plug into a USB slot on a laptop or desktop computer. The software would launch when the USB device is plugged in. The Holmdel, N.J., company is billing the device, dubbed the V-phone, as a major addition to its services, particularly in the business market. Other companies already have developed similar technology. VoiceStick, a technology developed by i2Telecom International Inc., of Atlanta, an Internet-calling provider with roughly 10,000 customers, has many of the same features as the device that Vonage is expected to release. SanDisk Corp. has a USB device on the market with Skype software, and Mplat Technology Co. is marketing a similar product. Vonage Chairman and Chief Strategist Jeffrey Citron called the device a "phone on a key ring" when he mentioned it at a conference earlier this week. Mr. Citron said the USB phone will launch this week and will be aimed at business travelers, a market Vonage has struggled to penetrate. "This will fundamentally alter the way people do business," Mr. Citron said. The device will cost $40, excluding promotions, and will be available to consumers who have signed up for a Vonage calling plan, a person familiar with the situation said. The initial version of the USB stick will have only the Vonage software loaded on it, but later editions will include additional memory storage capacity, the person said. It isn't clear what advantage the new stick phone brings when many travelers already use laptops that are equipped with software for making free or deeply discounted calls, said Richard Greenfield of Pali Capital Inc., who has a sell rating on Vonage shares. "We're trying to understand the primary advantage of a product like this," he said. In a recent report, Mr. Greenfield said Vonage highlighted the new phone as it was making the rounds of potential investors prior to its IPO. In his first appearance since the IPO, Mr. Citron said he sees a potential opportunity in "dual-mode" cellphones that can roam between Wi-Fi and cellular networks. Mr. Citron said Vonage will continue its aggressive marketing campaign, a strategy that has turned off many investors and analysts. ================================================= George Antunes Voice (713) 743-3923 Associate Professor Fax (713) 743-3927 Political Science Internet: antunes at uh dot edu University of Houston Houston, TX 77204-3011 Reply with a "Thank you" if you liked this post. _____________________________ MEDIANEWS mailing list [email protected] To unsubscribe send an email to: [EMAIL PROTECTED]
