Commlaw Source

FOLLOWING THE TELECOMMUNICATIONS INDUSTRY AND RELATED LEGAL TOPICS

Tuesday, August 01, 2006

Vonage and Verizon report earnings ...

Verizon announced a 24% drop in it second quarter profit do at least in part to customers switching to competitors, such as Vonage and cable operators. At the same time it's losing core customers, its expending huge sums on its FiOS fiber optics rollout.

Meanwhile, Vonage reports adding 1,005,000 net subscriber lines during the year ending June 30, 2006 -- with a whopping 256,000 coming in the most recent quarter. Vonage now boasts 1,853,000 total subscriber lines, a quarterly increase of 16% and an annual increase of 119%. It remains to be seen when Vonage will turn a profit, but it looks like the company is increasing its subscribership while decreasing its losses ... a positive combination that proved very elusive for first generation competitors.

The combination Vonage and Verizon announcements may very well explain Verizon's incessant legal and policy attacks on Vonage and other competitors. If you can't compete on the field, work the referees.

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