Vonage (VG) Settles With Verizon (VZ)
October 25, 2007 by Douglas A. McIntyreIt looked like patent suits from the nation’s largest phone companies were going to put VoIP pioneer Vonage (VG) out of buiness. But, it settled its differences with Verizon (VZ) after the close.
Vonage announced that the cost of its settlement of a patent dispute with Verizon will be effectively capped at a maximum of $32 million, in addition to the $88 million already accrued and held in escrow. The $88 million includes a $66 million cash-collateralized bond, a $12 million second-quarter escrow payment, and a $10 million third-quarter escrow payment made in the fourth quarter of 2007.
Verizon can afford to be merciful now that it is beating the life out of cable companies like Comcast (CMCSA) by stealing their broadband and TV customers.
Douglas A. McIntyre
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