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Vonage Vexed By Verizon. And You?

Earlier this month, a reader e-mailed to ask a question:

People are doubting Vonage's future because of today's ruling. I have had Vonage for a year and I love it and I know other people who like it as much as I do. If Vonage tanks, what do we all do? Do we have recourse or do we have to go back to Verizon?

I wanted to offer some it'll-all-work-out reassurance, but this was all that I could honestly write:

If the company does have to stop providing service, you'd have to find another VoIP provider, then hope that this other company didn't have any patent problems of its own. Unfortunately, that's not the kind of thing anybody--not even patent attorneys who actually know this stuff--can guarantee.

That reader can relax for now; Vonage won a permanent stay of the ruling that would have forced it to stop signing up new customers. But the underlying uncertainty remains: If you choose to do business with a company providing a new product or service, how can you tell that it won't get socked with a patent-infringement lawsuit that, if successful, might force it to charge you more, alter a product you like or go out of business altogether?

Vonage is trying to capitalize on this sentiment with a "Free To Compete" Web campaign (note that its headline--"Al Gore Invented the Internet. Now Verizon Is Trying to Patent It"--repeats an old untruth, as Gore neither invented the Internet nor claimed to have done so.)

You should expect no less from any company stuck in a litigious quagmire. But setting aside the self-serving nature of Vonage's campaign, it does raise a valid point: Overly broad patents can hurt competition and ultimately force customers to give their business to the company with the most lawyers.

Speaking as a customer of technology, that bugs me. I don't enjoy having to act like a venture capitalist, picking which company is least likely to run into patent problems. Then again, maybe I shouldn't even worry, since it seems like everybody will run into them at some point--and not just individual companies (for instance, Palm, Research In Motion, Microsoft) but even entire sectors of a market (memory manufacturers, Linux developers).

Have these issues affected your own technology-shopping decisions? Let me know in the comments...

By Rob Pegoraro  |  April 25, 2007; 2:28 PM ET
Categories:  Telecom  
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