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Vonage Persists with Patent Settlement Strategy

3:00 am on December 25, 2007 | Category: Business, Editorials, Law, Telecom Services, Telephone, VoIP

Broadband phone provider, Vonage, finalized a settlement agreement with AT&T last Friday, ending a patent dispute between the two companies.

Vonage, whose internet phone service acts as an alternative to fixed-line telephone networks, has been hit with a number of patent lawsuits since its Initial Public Offering in May 2006. This fall, the company has adopted a strategy of settling the disputes, paying off Sprint Nextel and Verizon Communications in October.

There are concerns that such a policy could ultimately backfire, however, as an ongoing string multi-million dollar settlements encourages more companies to jump on to the â€œsue Vonageâ€ bandwagon.

This may be one reason why the specifics of Vonage’s settlement with AT&T were not made public. Judging by previous settlements, however, its safe to say that AT&T’s payoff will run well into the tens of millions.

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