'My Mate Jeff Citron' - Daniel Berninger
Om writes a piece on an article by Daniel Berninger defending Vonage and Jeffrey Citron.
'Skype and the voice offers of Google, Yahoo, and Microsoft do not represent competition as they do not offer a substitutable service.' - says Daniel. So 911 access is the key to market success?
I don't know any law that requires I have a phone, therefore there is no law that requires I have 911 access. So, if I can have naked broadband, then I can use any VoIP service. The government (generic as opposed to US) could prevent me from having a geographic number but how long will that be relevant?
The substitution argument is transitory.
Also, if Vonage stopped spending the marketing dollars, how many subs do you think they would get?
Skype and G/Y/M/A are not targetting the same segment that Vonage does, but Skype is starting to move closer. If Skype decided to go after Vonage customers, how much would they have to spend to take them away? Probably a lot less than Vonage paid to get them from the telcos.
Let's just watch how quickly the Vonage directors divest their options, that will be a good indication of how long they expect Vonage to hold or exceed its current valuation!