Internet Telephone Service

Vonage Zooming to Hit the One Million Mark

June 1, 2005

Vonage predicts that they will reach one million subscribers by the end of 2005. Currently Vonage has 700,000 customers and is adding 15,000 new phone lines a week. The company also plans on moving into 35 new territories in Canada.

Lois Holder, Vice Executive President of Vonage stated, "When VoIP was first introduced in the 1990s, computers just weren't fast enough to do audio conversions," and added that the widespread use of dial-up also made initial adoption sluggish.

"The ground we've covered, and the problems we've overcome in just the past five years have really allowed the technology to catch up to the potential," Holder stated. "And that's reflected in subscriber growth."

Because VoIP sends voice traffic over the Internet, which helps keep costs down, compared to analog phone service. Jeffrey Citron, Vonage chief executive said that the cost advantage and the unique extras are what drive people away from traditional services.

Many new companies are beginning to offer VoIP services and cable companies are offering bundle packages that include VoIP and cable television. Vonage has more competition. The problems with E-911 might also put pressure on VoIP providers to raise prices. These are some of the hindrances that could slow Vonage's growth.



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