I subscribe to Vonage. I like Vonage. As a consumer, I love their business model. I've been a Vonage customer for over a year now. I don't understand the IPO.
Vonage has been bleeding cash for years now. With losses mounting to over $310Million since 2003 the company isn't even close to profitability. This should make an IPO next to impossible by post-bubble standards. Forrester claims that 15% of US households will have VOIP by 210. That's why you shouldn't pay these analysts, they don't have a clue. Services like VOIP over Wi-Fi will and bundled VOIP services through Cable will reach households into the 30-40% range (but that's for another post).
But that's exactly the reason why Vonage isn't really poised for an IPO. Voice over Wi-Fi, WiMax and Cable will become the primary platform for communications. What's more, phones are being replaced with IP services over computers, not to mention VOIP/Mobile handsets. Phones as we know them aren't being used as they were just a few years ago. I know people that don't even have a land-line anymore and rely on mobile communications exclusively.
Which begs the notion, who would invest in Vonage knowing that this non-profitable VOIP company is really only a first-generation player in the consumer VOIP space. Guess we'll have to see. Acquisition would be a better play here.