AT&T Joins The Party Of Jealous Telcos: Sues Vonage For Patent Infringement

from the anyone-else-want-in? dept

Mon, Oct 22nd 2007 1:03am — Mike Masnick

If you can't beat 'em, sue 'em for patent infringement. That seems to be the lesson that various telcos have learned in dealing with Vonage. Having seen Verizon and Sprint win big awards for patent infringement against Vonage, AT&T has now sued the company for patent infringement as well. The story, once again, is exactly the same. AT&T tried, and failed, to compete with Vonage in the marketplace. So now that they've lost, they've sued. It has nothing to do with Vonage "stealing" any technology. The technology behind VoIP is fairly straightforward. Perhaps that's why it seems like everyone claims to have VoIP patents. At this point, it's just ridiculous piling on against the first company that actually figured out how to market a VoIP telephone replacement service by a bunch of telcos who refused to innovate.

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Filed Under: patents, telcos, voip
Companies: at&t, sprint, verizon, vonage

23 Comments

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moe, 22 Oct 2007 @ 2:14am

Any patents left over at Vonage?
I'm interested to know what patents each of these companies is picking in their lawsuits. At some point you'd think there wouldn't be anyone left to sue.

What I'd love to see is Vonage turn around and say, "Exactly how non-obvious are these patented ideas if everyone and their brother can sue us over them?" Hopefully, AT&T's suit is the tipping point for a patent judge to realize that the patents should be invalid (for obviousness or broadness) if 3 major companies could find some grounds for a lawsuit.
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none, 22 Oct 2007 @ 2:20am

wha?
I understant TD likes to rail against patents and those that sue when they are violated, and in a lot of cases, y'all are right. In this case, I think you've got it wrong. If Vonage is such the innovator and wasn't violating someone else's patents, then why would they settle with Sprint, license the (violated) patents from Sprint and work around two of the three patents Verizon claims they violated (after a jury said Vonage violated them).
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Bob Knight, 22 Oct 2007 @ 2:51am

When You Don't Have The Cash To Fight, You Switch.
I bet most of these patents sound like this:

A method to carry voice conversations over a TCP/IP network using analog to digital and digital to analog conversion.

Prior art would be the first analog to digital audio patent.

I think the reason Vonage is not fighting all these suits tooth and nail, is that they are not able to because of the cost.

As to jury verdicts in patent suits, most juries are made up of the functional equivalent of the 67 year old woman who can even turn on a computer.

Vonage started to take market share, so it has to be stomped out

The reason I went to Vonage was all the taxes on my POTS land line. I mean 26 bucks for all the calling you want is not to bad, before Vonage I paid 32 dollars just for the privilege of a land line and that was before I used long distance.
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Mike (profile), 22 Oct 2007 @ 2:52am

Re: wha?
If Vonage is such the innovator and wasn't violating someone else's patents, then why would they settle with Sprint, license the (violated) patents from Sprint and work around two of the three patents Verizon claims they violated (after a jury said Vonage violated them).

Because it's quite expensive and time consuming to fight these patents...
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none, 22 Oct 2007 @ 3:41am

Re: Re: wha?
More expensive than licensing the 'violated' patents, working around other 'violated' patents, and settling lawsuits?
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Online Market Research Report, 22 Oct 2007 @ 4:08am

Vonage and Copyright
From Youtube, to Kazaa to Vonage have one thing common that they manage to break vicious grip of conventional suppliers who were ripping our wallet. it is really shame to see that they have become now victim of these deep pocket envious giants :(
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MadJo (profile), 22 Oct 2007 @ 4:09am

Re: Re: Re: wha?
In most cases? Yes.

Attorney fees aren't exactly cheap, and these cases can take a long time. It's not a matter that can be settled within a few hours. (though from our vantage point, it might seem that way, because most of these cases are just frivolous)
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Caller, 22 Oct 2007 @ 4:33am

Calling Class Action Lawyers.......
Vonage customers should hire a lawyer and file a SLAPP suit against the protagonists in thee suits. Shoot for a billion or two and that should get their attention.

Screw you AT&T.
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MEDIAEMPYRE, 22 Oct 2007 @ 5:23am

Why doesn't the FTC or the FCC file a lawsuit against the big telcos? If they knew how to do this and didn't, they violated the terms of merger agreements. How come Vonage can come up with this so much cheaper than they could??
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RandomThoughts, 22 Oct 2007 @ 5:50am

Wow, Vonage did fight Verizon in court. They lost. A few juries ruled that Vonage violated patents. One jury even ruled on the merit of the patent. Vonage still lost.

Maybe Vonage settled the Sprint lawsuit because they knew they were going to lose?

I guess the AT&T suit pretty much rules out Sprint buying them (something I never thought would happen) but it made for a nice article.

Yeah, Vonage brought VoIP to the masses (well, sort of) while the telco's didn't. Of course, if you don't worry about losing money in order to gain customers and run commercials everywhere, I guess you can do that. I wouldn't call that a good business plan, but you can.
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Chronno S. Trigger, 22 Oct 2007 @ 6:38am

Re:
Your comments always surprise me.

Vonage is only losing money because they are getting sued by the big dinosaures who can only wright up patents that should be invalid. Seems obvious to me that these patents are far to obvious and broad.

As a reminder to you, patents are to encourage innovation. Vonige innovated, Verizon, Sprint, and AT&T failed to.
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3-Way Conference, 22 Oct 2007 @ 6:54am

Fucking Verizon: "Hello? Hey Sprint, I think I just nailed these fuckers... maybe just wait until I am done with them, then it will be your turn OK?"

Fucking Sprint: "Thank you Verizon, I am sure they will just pay whatever I want... I am just happy that I'll do them when they are tired... thanks for loosening them up... Yo, AT&T... your joy will be even better... there will be almost no waiting time for you to cash out from these guys, sounds good?"

Fucking AT&T: "You guys rock! lemme know when you are done, so I can finish them off, but hey... please thank 'The People' for agreeing that we can screw them, if it wasn't for them, we'd probably be the ones being completely screwed. I guess we'll have to sponsor some landlines to these good samaritans that understood how bad Vonage is for America and American business."
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DG Lewis, 22 Oct 2007 @ 7:22am

"AT&T tried, and failed, to compete with Vonage in the marketplace."

AT&T's lost maybe 800k subscribers to Vonage (compared to about 2.8M lost to cable), and still has 59.4M lines in service. Vonage's growth is slowing down and will probably plateau at around 3M, about 5% of AT&T's total line count.

And AT&T's stodgy old-fashioned POTS is generating about 40% more revenue per line than Vonage.

So how, exactly, has AT&T "failed to compete with Vonage in the marketplace?"
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Danny, 22 Oct 2007 @ 7:28am

Moe may have a point...
With three companies (and I wouldn't be surpried if a few more come out of the woodwork) trying to get a piece of Vonage I wonder about two things:

1.Since all three of these companies are suing over patents related to VoIP then doesn't that mean that those three companies are probably violating each others patents? But I'm sure there is more than enough coprorate back scratching to clear that up.

2.How non-obvious can these VoIP patents be if three companies are ganging up on Vonage to for lawsuits? If only there was some way to have those patents rendered invalid.

2.If by chance AT&T, Verizon, and Sprint are all going after Vonage over "different" patents that all realted to VoIP doesn't that mean that anyone that is not one of those three companies will either have to pay outrageous licensing fees or be sued out of existence?
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RandomThoughts, 22 Oct 2007 @ 7:30am

Chronno, Vonage was losing money before the lawsuits were filed. Vonage has in fact never actually made money (except for its founders.) How exactly did the lawsuits make Vonage unprofitable?

VoIP is a pretty basic thing, getting it to work with the PSTN isn't. How you go about doing these things is where Vonage voilated Verizon's patents, probably Sprints patents and now AT&T.
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Chronno S. Trigger, 22 Oct 2007 @ 8:17am

Re:
I'd say that paying out to Verizon, and now Sprint, and soon AT&T would cause you to lose money.

If getting VoIP to work with PSTN (not sure what that is) is infringing on Verizon's, Sprint's, and AT&T's patents, then it still seems kinda obvious that it's obvious.

Kinda a dumb question here, but if you can call a Sprint customer from a Verizon phone then doesn't there have to be some kind of universal language (so to speak) that both phone companies have to speak to work together? Isn't it the same with Sprint and AT&T, or AT&T and Verizon? Why is it that when Vonage uses the same universal connection they are infringing?
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Anonymous Coward, 22 Oct 2007 @ 8:41am

Re: wha?
for the same reason RIM had to settle their case with NTP even thought NTP patents were bogus and crap
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RandomThoughts, 22 Oct 2007 @ 8:44am

Re: Re: wha?
Which ignores the fact that Vonage went to court with Verizon and lost. Obviously someone didn't think that the Verizon patents were bogus and crap.
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Anonymous Coward, 22 Oct 2007 @ 10:47am

Think about it for a second, this is a free-market economy. Businesses are in business to make money, and to screw the competition any way they can. Vonage was a sinking ship due to their negative financials, so the sharks circled in and are now having their lunch. We can bitch and moan about bogus patents all we want, but the fact is, that it's a legitimate patent, regardless of what we think, and those companies have a right to go after those who infringe.
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Mike (profile), 22 Oct 2007 @ 12:06pm

Re:
Wow, Vonage did fight Verizon in court. They lost. A few juries ruled that Vonage violated patents. One jury even ruled on the merit of the patent. Vonage still lost.

It's worth noting here that juries almost *ALWAYS* rule in favor of the patent holder, as they rarely have the technical knowledge to determine whether or not a patent is crap.

Maybe Vonage settled the Sprint lawsuit because they knew they were going to lose?

Indeed, but they could still lose and it wouldn't change the questionable nature of the patents.

Yeah, Vonage brought VoIP to the masses (well, sort of) while the telco's didn't. Of course, if you don't worry about losing money in order to gain customers and run commercials everywhere, I guess you can do that. I wouldn't call that a good business plan, but you can.

Both Verizon and AT&T launched nearly identical (and eventually identically priced) services to Vonage, but were unable to capture significant marketshare. So to argue that it's all about price is simply, factually wrong.
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RandomThoughts, 22 Oct 2007 @ 12:18pm

Mike, I am sure you wouldn't reccomend that a client canabilize its own service with a cheaper service before it needed to, right?

VoiceWing and CallVantage were not priced as low as Vonage, nor was it ever advertised as heavily. Neither service was targeted to combat Vonage, but more for battle with cable companies.
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A pissed off consumer..., 22 Oct 2007 @ 12:20pm

When did you arrive at the conclusion of legitimate patents? Especially given the fact the argument is coming from Verizon, Sprint & AT&T - these companies are accustomed to screwing people for generations while they are the only available "over the wire" (pots, cable, etc.) carriers, at least in the eastern region of the US. They take someone else ideas, put them together as another idea and then patent it. Any idiot can do that, yet we allow them to claim such ideas as their own. Business in the US is about money and we know that from Chinese riddles, the Business is war. It's not what these companies can accomplish for you, it is how much you as consumer can afford to have stolen from your pocket before you start beating people up for it. BTW: they are not the only ones, the government also figured it can rig a profit on both the companies and consumers and so we are forced to take this crap from both, none the wiser. We should force these suckers out of our pockets and hopefully out of business by not indulging into their products, perhaps then after loosing billions we can get them to become human beings again.
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power laptop battery, 5 Oct 2008 @ 11:52pm

battery
Yeah, Vonage brought VoIP to the masses (well, sort of) while the telco's didn't. Of course, if you don't worry about losing money in order to gain customers and run commercials everywhere, I guess you can do that. I wouldn't call that a good business plan, but you can.
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