And Another One: Nortel Latest To Sue Vonage Over VoIP Patents
from the who-else? dept
A "patent thicket" is when so many different entities claim patents on a particular space or product, it becomes nearly impossible for any company to actually put a product out in that space without either having to pay ridiculous patent license fees or face a series of patent lawsuits. There are plenty of patent thickets out there -- and a big one is in the VoIP space. The concept of using internet protocol for voice communications has been out there for ages, and there were lots of attempts to get such a service working in the late 90s. While technically it was possible, the real problem was that most users didn't want to go through the hassle of setting things up to use VoIP. Vonage was the first company to get past that hurdle by making things easy: you plug a box into your modem, and then you plug in a phone -- and everything works just like your current telephone. It was this simplicity, combined with a big advertising campaign, that made VoIP popular. It certainly wasn't the basic technology advances that almost everyone in the space had figured out well before. Yet, Vonage's ability to attract users made lots of other firms jealous, leading to a series of patent lawsuits. Earlier this year, under pressure from Wall Street, Vonage agreed to settle such patent lawsuits from Verizon and Sprint, as well as some tiny patent holders. As we noted at the time, this was simply flinging the gates wide open -- and anyone who had any kind of patent related to VoIP should probably sue Vonage as fast as possible.AT&T couldn't resist and dredged up some VoIP patents itself. And, sure enough, Vonage quickly settled. Of course, that wouldn't be the end. Now along comes Nortel, who has also sued Vonage for infringing on nine separate patents. To be fair, Vonage may have also brought this one on itself, having first sued Nortel over its own patents, leading Nortel to retaliate. You would have hoped that Vonage would have learned its lesson that patent battles aren't particularly helpful, but it appears that the company took away the wrong lesson, and is hoping to get in on the patent dollar bonanza. All we're really seeing is a blatantly clear explanation of how patents are holding back innovation, rather than promoting the progress of useful sciences. Update In the comments, someone from Vonage notes that the company did not quite initiate this, as the lawsuit actually came from another company that Vonage acquired.
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Filed Under: patent thicket, patents, voip
Companies: nortel, vonage
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From what I understand about the case, Vonage itself did not file against Nortel. Apparently, this suit against Nortel was originally filed in 2004 by Digital Packet Licensing. Vonage then acquired the patents (and subsequently the litigation) in the suit in 2006.
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Uhh
Haven't they already been sued for every single aspect of their business?
In which case it would be the patent office's fault for issuing so many redundant / broad patents.
They have already paid liscensing fees / settlements for everything they do.
Or is my logic here somehow flawed?
It makes sense, but I know the stupidity of our court & patent systems wouldn't allow it.
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There are many forms of VoIP, companies use many different ways to get there. Seems Vonage decided to take some shortcuts.
They chose that route, they decided to cut corners. Cutting corners allowed them to offer cheap phone service, but is that what we really want to encourage?
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Better than LAN...
1) Only those who I give my number to call, no more sales weasels.
2) Every message I receive gets sent to my email.
3) I can check every single incoming and outgoing call via their web portal, that's a first.
4) Caller ID displayed on your TV, no charge.
5) Very nice 4 port modem router FREE.
6) Signed up on a Saturday and received modem Monday.
7) $31.88/month total cost for unlimited calling, PRICELESS!
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Re: Uhh
Which begs the question -- how can so many different companies hold so many different patents on the same technology? Sure, I can see 1, 2, or maybe even 3 different companies holding different patents for different parts of the technology. But with this many companies raising up with claims against Vonage, at some point wouldn't a "prior art" or "obviousness" clause kick in? Unfortunately, since Vonage doesn't want to pay for trials for all of it, it won't be challenged.
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Re: Uhh
You bet it is, dude
You have a logic of an imbecile
Go get your GED, punk
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Re:
It wasn't cheap to Vonage investors
I can offer *free* phone service if I find enough clueless idiots with enough money to spend like couple hundred bucks per each new sibsriber
heck, what a brilliant business plan !!! Spend other people's money on building large subscriber base only to be sued for patent infringement ....
Those Skype guys are a lot smarter
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Re: Better than LAN...
yeah...
Add the cost of Comcast cable internet or Fios to this figure
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Re:
There are a few reasons.
(1) Vonage is an easy target. They're big, with lots of publicity and they raised millions of dollars in the public market. That makes them an easy target.
(2) They didn't have a huge patent portfolio of their own, with which they could countersue.
(3) They beat all of these firms to the market, making those firms jealous.
When was the last patent lawsuit filed against AT&T, Verizon, Cox Communications, Time Warner Cable, Sunrocket or any other company out there using VoIP.
Which of these firms is not like the other... Sunrocket is out of business and never had any money in the first place. But as for the others, many have their own patent portfolios, so you get a nuclear stockpiling situation, where no one wants to sue each other to set off a patent war. Vonage had no such patents... hence it getting sued.
What you claim is "cutting corners" was not. With almost all of these patents, you can easily point to prior art in the space, or the fact that the concepts were clearly obvious to those in the space. Unfortunately, the USPTO's standards for approving patents don't actually look at real prior art or real obviousness.
Furthermore, even if they had taken all of these ideas... why should that matter? Vonage succeeded by putting them all together where no one else could. Isn't that what we should be encouraging? The progress came through Vonage's ingenuity. It didn't come from AT&T, Verizon, Sprint or Nortel... all of whom sat back and hoped that VoIP would never amount to anything.
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Re: Re: Better than LAN...
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Patent stockpiling
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Re: Re:
Mikey is smoking weed again while typing utter nonsense on his keyboard...
and this is called "journalism" these days...
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Re: Re: Re:
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They seem not to contribute to the discussion and have a tendency to stir things up with baseless assertions.
Don't they have anything better to do than trolling?
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(2) They didn't have a huge patent portfolio of their own, with which they could countersue.
(3) They beat all of these firms to the market, making those firms jealous.
1, how does that make them different than the other VoIP cable companies?
2. Yeah, because they just used everyone elses technology.
3. Thats pretty funny. I bet the guys at Verizon were just drooling over Vonage's quarterly loss each and every quarter that Vonage has been in existance. I bet Ed spent all his time trying to come up with net losses so he could take that to wall street.
In what world is losing money a good business model? Forget the lawsuits, Vonage has never turned a profit.
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angry dude
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Re:
Again, Vonage didn't have the same ability to fight back as the cable companies do. Also, the cable companies didn't have nearly the same level of publicity surrounding VoIP as the cable companies did.
2. Yeah, because they just used everyone elses technology.
Again, that's not true and secondly, even if it were true, it wouldn't matter.
Your claim that they used everyone else's technology is laughable. When Vonage launched, can you tell me which of the companies suing it had a matching product on the market?
3. Thats pretty funny. I bet the guys at Verizon were just drooling over Vonage's quarterly loss each and every quarter that Vonage has been in existance. I bet Ed spent all his time trying to come up with net losses so he could take that to wall street.
The guys at Verizon were drooling over the fact that they were losing customers to Vonage, absolutely. They were scared shitless, which is why they sued. It wasn't about the quarterly numbers. The folks at Verizon were quite aware of the nature of the land grab, and the fact that it was increasing their own churn. Ed Whitacre absolutely recognized that.
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Come on Mike, get real. They didn't care about Vonage. They were afraid of VoIP, but not because of Vonage. They have always known that VoIP opens them up to the cable companies, that is what they are afraid of. Vonage? Thats pretty funny.
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Re:
When I was on cable several years ago, I had digital phone service through them, but it was branded as AT&T (Insight was the cable co). So there's an example of a cable company and a phone company coming together on VoIP. The big cable companies also rely pretty heavily on the phone companies (at the very least AT&T) for backbone internet connections. While the cablecos and telcos might have a bit of a love-hate relationship, there's one thing they can both agree on: they don't want to become just a dumb pipe. So I disgree, AC...I think they care very much about Vonage, but only partially for the reasons most ascribed to them. The real issue, I believe, is that as more people move to such third-party offerings, more people begin to demand the decoupling of services from the connection, and that's precisely what both the cable and telephone companies want most to avoid.
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Re:
Think of it this way. Vonage was/is the top name in the VoIP space (depending on your point of view). If Verizon was able to successfully get after Vonage, it would allow them to pretty much get after everyone else and effectively let them hold the key to entering the VoIP space. The case may have been about Vonage, but it was a battle in a bigger arena of them protecting their business model over getting market share. Vonage just happened to have the biggest bullseye and provided the biggest turnaround for the market depending on how the case went.
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Hell, a cable company in Canada was giving away voice. How do you compete against that if you are a pure play company?
It is about the bundle, not about unbundling. No one will make much money as a pure voice player, because that is a commodity. What was Vonages options? Wonder why no one wanted to buy them?
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Forget about the lawsuits, Vonage is not and has never been profitable.
Are some of the lawsuits bullshit? Sure, but people shouldn't try to turn Vonage into something its not and never has been.
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Enlightened
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