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Vonage Expects to Settle AT&T Patent Lawsuit by Month’s End

Vonage has reached an “agreement in principle” to settle its intellectual property dispute with AT&T, the VoIP pioneer announced yesterday.

The deal under discussion would have Vonage pay $39 million over five years, in exchange for AT&T dropping its patent infringement lawsuit. Vonage would also agree to drop its counter suit against the telecom giant.

“We’re moving in the right direction with regard to AT&T and are focused on finalizing our agreement by the end of this month,” said Charles Sahner, a spokesman for Vonage. “We would like to be able to put AT&T behind us together with Verizon, Sprint and our other recent settlements.”

Vonage’s new strategy of settling patent infringement complaints has been a convenient and effective way of avoiding crippling injunctions against its technology, but it has also been very costly, cutting into the unprofitable company’s ever-dwindling supply of cash.

“The company’s cash requirements in the fourth quarter increased due to the release of $78 million of restricted cash to Verizon, an additional $2 million to Verizon, $40 million placed into escrow and reported as current restricted cash until the Verizon appeal is decided, $80 million to Sprint and $2 million in other IP litigation settlements,” the company said in its most recent financial statement.


December 7, 2007 Posted by | Business, Law, Telephone, VoIP | , , | Leave a comment

Bloggers Speculate About Possible Google-Skype Acquisition

Internet search giant, Google Inc., may be poised to acquire the world’s leading online VoIP service, Skype, according to speculation in the blogsphere this week.

The rumours originated with the UK’s well-respected Guardian newspaper on Monday, and have been reverberating through investment firms and the blogsphere all week. No solid basis has been provided for the speculation, but there are logical reasons for Google to consider acquiring, or at least forming a partnership with Skype, which is currently owned by online auction leader, eBay.

“Currently in favor around London’s webbist community is the rumor that Google has been in negotiations to buy Skype,” wrote Jemima Kiss, a blogger with the Guardian. “Google bases all of its mobile projects in London, so this is the fitting place for such a rumor.”

It’s true that Google and Skype have been moving in a similar direction in recent months; for example, partnering with several other companies to fund Fon, a Spanish startup attempting to build a worldwide network of shared Wi-Fi hotspots.

Skype and Google also have some shared interests with regard to an upcoming 700-MHz airwaves auction in the U.S., where both companies have pressured regulators to make existing wireless carriers “open up” their networks.

A Google acquisition of Skype “makes sense on a number of levels, particularly because it fits with Google’s ambitions for disrupting the mobile industry through its new open mobile phone development platform Android,” Kiss wrote, noting that a such a deal might also be attractive to eBay, “which was recently forced to admit that it had paid too much for Skype.”

When asked to comment on the speculation, however, Skype itself remained silent, insisting that it does not respond to rumours.

December 7, 2007 Posted by | VoIP, Web Services | , , | Leave a comment