Verizon and Vonage Patent Dispute: What the Means to VoIP

One of the concerns some have for the future of Vonage is the recent patent dispute ruling requiring Vonage to pay Verizon one-time and recurring royalties for infringement on patents Verizon owns. This issue has ramifications perhaps for the entire VoIP industry and is by no means the only set of patents requiring communications companies to pay royalties. RTI or Rates Technology Inc. is another company collecting patent-related revenue in the VoIP space.
To turn this matter into an interactive web discussion you can partake in, TMCnet has set up a page devoted to the patent infringement lawsuit between Verizon and Vonage. The goal of this page is to get a conversation going within the VoIP industry and beyond about the significance of this news and the repercussions for our industry. There is no single repository I am aware of with more informed contributors on this matter.
I have taken some of the salient points of this interactive conversation and added some of my own insights as well.
The difference between RTI and Verizon is Verizon competes with Vonage. Russell Shaw for example believes the Verizon patents are overly broad. He thinks this ruling will cast a shadow over the future of Vonage service.
Vonage says emphatically that even if they are forced to pay Verizon for every call as the court suggests their business will not be affected.
Russell also thinks this ruling may signal that the little guy is going to have a tough time slugging it out against companies with large patent portfolios. My take is you need to become a big enough target for a large company for them to even consider going after you.
John Cimko, a regular contributor to Internet Telephony Magazine and a former member of the FCC says he believes this ruling may undermine the strength of competition in the VoIP market.
Jon Arnold thinks this ruling could lead to an acquisition of Vonage by Verizon. He reminds us that Vonage is still the number one provider of broadband VoIP services.
Hew Rees the VP of marketing at 8×8 the parent of Packet8 service says the ruling is unfortunate for consumers and is also confident the company’s own patents offer it a great deal of protection from a lawsuit.
And Greg Welch, CEO, GlobalTouch Telecom has positive insight on this story. He believes entrepreneurial companies will always find a way to survive – no matter what. I tend to agree with Greg.
What’s your opinion? Do you have one? Are you a frustrated consumer or a Vonage competitor? Perhaps you work for Verizon, AT&T or a cable company? Regardless, your comments are welcome on this page. Join the conversation and tell us how you feel.

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