Vonages Uses VoIP Spam To Push IPO On Customers

from the that-doesn't-look-too-good dept

Before this week, there was already substantial doubt about Vonage’s IPO prospects. The company’s s-1 did not look promising; profitability will be distant, if it comes at all. Then, yesterday it announced that it was giving its customers a chance to buy into the IPO. Though they made it seem like they just wanted to give back to the customers who have helped them get where they are, it was seen as a real sign that there is lack of institutional interest in the company’s IPO. Today, the story gets even worse, as they appear to be engaging in the first case of VoIP stock spam as a way of pushing their stock on customers. The company sent out mass voicemails (and emails) encouraging customers to participate in the stock purchase plan. Considering the legitimate fears that people have about an explosion in VoIP spam, and the inevitable comparisons to penny-stock spam scams, the move makes the company look like it’s not ready for the big leagues. The action could also prompt some unwanted SEC scrutiny, which already has a beef against founder Jeffrey Citron relating to, yes, a stock scam. Furthermore, they risk alienating their customers who have more alternatives every day. Before a company goes public, it needs to convince investors that they’re strong and stable; if this deal is going to go through they have a lot of explaining to do.


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Comments on “Vonages Uses VoIP Spam To Push IPO On Customers”

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32 Comments
Luis Escobar says:

More investigation

This individual need more investigation if he did that at DAYTK he olso is doing this at Vonage he changed of position to get the Ipo but he is the one in control this individualds are the ones that damage the industrie just think whit 1.2 million subs the month revenues must be in the 30 million per month , How much of this go to Citron Poket ?

jenny fielding says:

vonage IPO

while it is true that a customer aquisition cost of $400+ per sub is outrageously high – I still see promise. Vonage has done an excellent job in branding itself – as more people know the name than subscribe tot he service. And as we know, perception alone can drive investment and ultimately a buy-out. I’m putting my money on vonage!

Derek Kerton (profile) says:

SPAM

Vonage is buying real estate in a game where real estate is going to be valuable. But the price they are paying is too high to allow for much upside.

As for the SPAM. That s@#t REALLY pissed me off. I have multiple Vonage lines, and actually get the Voice Mail by email after having split it into two accounts that my partner and I both receive. This means we go the Vonage SPAM six times. This is unsolicited crap, and a true transgression.

I’ve backed Vonage up on a bunch of things, most notably 911, but spamming your users for money (and claiming you’re doing me a special favor) was an asinine move.

Anonymous Coward says:

Lots of other reasons the IPO might be soft

I’m curious as to whether the huge vested interests (telcos) are trying their damndest to hurt the Vonage IPO. Perhaps they would apply pressure to institutional buyers. Perhaps institutional buyers are worried about what a succesful Vonage IPO might do to their holdings in telcos?

Anonymous Coward says:

Vonage actually provides a great service. They deliver as advertised, which is something most Telcos cannot say. I’m a Vonage customer and an IT professional. I personally see no problem in sending me out mail about the IPO. I want the company to succeed and as a customer welcome the opportunity to be part of company’s financial success as well. This so called spam is nothing different to me anyway vs. teh other mail I get from them time to time. Just information.

teKuru says:

Didn't mind..

I got the email from Vonage and I didn’t mind at all. Comparing them to penny stock scams? I think that is a little overboard. They were letting you know about their own IPO, not some random nameless comany from a message with a forged MTA header. Yes, it was mass mailed, voicemailed, etc, but how else do you contact as many customers as they have? I know a few people who use Vonage, and all of us got the email, none of us got any voicemails or anything. If this isn’t considered legitimate communication, I don’t know what is.

Sean says:

Spam???

I don’t know that I’d label this as spam. I appreciate the offer, and if I had a few extra bucks to spare I’d definitely throw my hat in the pot. It’s a great service, at a great price. I hope they do well with their IPO, and I think it’s great that they’re setting aside some options for thier customers. How else would you propose that they let us know that it’s available?

blurby blurb blurb says:

Vonages Uses VoIP Spam To Push IPO On Customers

I’m a Vonage customer, love the service and wish I’d been spammed on this one, but I didn’t get so much as a voicemail or email. The service is excellent, portable (plug into any broadband connection when I’m traveling and voila…just like being at home!) The price is excellent, the equipment I purchased is durable and the sound quality of my calls is as good or better than a land line and superior by far to my cell phone…which I’ve cut down to the minimum number of minutes since joining Vonage 6 months ago. Given the chance to invest, I’d throw some money their way. It’s a no-brainer.

Dan Galt says:

Re: short the stock and don't touch the ipo

I agree that their customer service stinks.

You wait forever and then talk to someone who doesnt speak the same English language that I do.

I could not explain in plain English what I wanted to have done, so I cancelled my service.

When I cancelled they were not kind enough to remind me of the 40 dollar fee for early termination that would hit my bank account that day.

How nice of them.

Laughing says:

Vonage actually provides a great service. They deliver as advertised, which is something most Telcos cannot say. I’m a Vonage customer and an IT professional. I personally see no problem in sending me out mail about the IPO. I want the company to succeed and as a customer welcome the opportunity to be part of company’s financial success as well. This so called spam is nothing different to me anyway vs. teh other mail I get from them time to time. Just information.

Look, it’s Jeffrey Citron, nice to see you read….

A History Lesson says:

Like history has shown us over and over in the past, many companies who pioneer a service or idea never make it. Vonage is one of them. Sure they have a great service, but VoIP and voice in general is becoming a complete commodity and those companies that will make money off of voice are the ones that can comnbine it as part of a larger telcomunications bundle.

Doug G. says:

off the deep end

I’m a Vonage customer and I did get an email about the IPO. I did not get a voicemail; I have to suspect the voicemail is either a fake or something they did as a limited trial. It’s hardly spam — I’m glad Vonage told me directly rather than me finding out after the fact from the press. And for all the nay-saying about horrible their IPO is going to be — there has apparently been so much interest in the IPO that they have doubled the size of it from $250 million to $500 million.

Patrick Mullen says:

With Verizon lowering its VoIP offering to below Vonage prices, and cable eating everyone’s lunch in terms of their bundles, I can’t imagine that a pure-play voice provider will be able to last. If a price war starts for voice and it further trends to zero, where is Vonages play?

Vonage has innovation going for it though, and it will be interesting to see them try to really be a player by adding additional services that make them attractive to consumers.

J.R. (user link) says:

I have been a satisfied Vonage customer for over 4 years, with multiple lines.

I received the E-mail offer, as well as the voice mail.

Forget the fact that “pre-purchasing” shares is a bad idea in general, but I don’t think this stock will hold the IPO value — and I believe that they feel the same way.

It is obvious they are trying to lock investors into the initial offering price because they don’t see the price holding on the open market. To pre-purchase shares, they require that you use/open an account that ultimately prevents you from selling your shares for several days after public trading begins.

It’s a brilliant idea, but experienced investors will see right through this one.

Anonymous Coward says:

amusing

It’s great to see the trolls arrive here to naysay Vonage, accusing Vonage supporters as being employees of Vonage or whatever. All they add is noise to the discussion, as one could label them as obvious old-school-telco employees. Trolls were so much more clever in the Usenet days before AOL. Now we have to deal with this generation of pondscum.

Anyways, Vonage just started offering free calls to Italy, Ireland, UK, Spain, and France. No price increase. Hate Vonage all you want, I use it and it rocks. They’re breaking the cabal of unnecessarily high phone prices.

ken domion says:

Re: amusing

run your fuckin techno freak mouth asshole…vonage is a rip off..period..do tell me how their scam stock offering did??value went right down the drain..they are a scam and did try to rip me off..but..ima little smarter than their retarded scam operation..and the powers that be after seeing what they tried to do to y bank account agree…time to shut them down..if you like to run decent people in the ground asshole cause you are so “tech smart”..perhaps you want to come visit me at my home??? didn’t think so…goddamn freak that you are..ken domion…anytime biotch…ps..ima soooo sure you look hot in a dress dude!!!

Steve G. says:

I Agree

Actually, trolls post as anonymous… and don’t contribute to the discussion. We’re discussing the IPO situation. Save the pom-poms for high school.

Actually, I agree with J.R… I love Vonage too, but rewarding customers means discounts and/or service upgrades, not “we want to thank you by taking more of your money in a different way”.

teKuru says:

Not Necessarily

Seeing as how we don’t have to login to post a comment, I don’t think the anonymous thing matters, as it only takes two seconds to put in a random name in the name box.

@#7, Did you get the email? I certainly didn’t get the feeling from it that I was being pressured into anything. Also, his internet went 30% slower? What speed connection?

Check this out: http://www.voip-info.org/wiki/index.php?page=Bandwidth+consumption

Don’t forget, if you are both talking at the same time, the bandwidth figures are times 2. Also, when you saturate your outgoing bandwith, your incoming drops to crap speeds.

@#8: India? Are you kidding me? I’ve talked to Vonage a few times, adding lines, removing a softphone, etc, and every time I have called I have talked to someone in New Jersey. The longest wait time I had was about 10 minutes, and that was after I had already spoken to someone, and was being forwarded to someone responsible for provisioning of the ATA adapter.

JJ says:

adding to previous post

Just adding 1 more thing on service..

If it is working, it is great. Works fine. If for any reason, you have any issue, fixing that problem with vonage is nightmare. Worst customer service. YES, they send you to half-trained tech in India. And keep you waiting for 45 minutes to 1 hour.

Still… willing to invest … I must be a fool!

Long Distance Talk (user link) says:

Shares allocated after the fact?

It is important to realize that the role as a customer is materially different from the role as an investor. Unfortunately I think many satisfied Vonage customers bought in as investors purely from their experience as customers, rather than through looking at this from an investment perspective.

Dropping 25% in two days is bad enough, but now it seems that some investors were actually told they had been allocated 0 shares, just to find out after the drop that they got shares after all: Vonage Allocating Shares After The Fact?

wade says:

vonage is killign itself before anyoonen else can

even if they were not under a war with verizon, they would sooner or later die because of their business practices, such as instituting cancelation fees in a system that was advertised as month by month NOT by contract.

How this is even legal is beyond me, I guess thats expected from pussy America, whio just sucks the cock of any corporation, and glady swallows.

also, the cancelation process is worse then AOLs

Fuck Vonage. I hope they burn.

Another thing I do not think shoudl eb legal is arbitrailrily sticking in your terms of service that you cannot be sued, WTF fuck America for even allowign that.

HEY, WE GOOFED AND NOW WE SUCK BUT DON’T WANT TO BE SUED FOR OUR MOB PRACTICES, SO LETS STICK IN THE TOS RANDOMLY A CLAUSE THAt says we can do whatever the fuck we want and not get in trouble or have to be responsible.

FUCK THAT, that clause should be illegal in any tos.

Im startign to hate america, the coutnry i once loved, more an dmore everyday.

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