Why is Vonage screaming?
While Vonage Chief Financial Officer John Rego wouldn't say as much during a recent interview, the inference was clear: much of Vonage's recent $200 million in funding is going towards advertising, on top of what is already a lot of Vonage TV, print and Web messaging.
The move makes sense on at least one level. As with any virtual operator that piggybacks their service on someone else's communications infrastructure, brand recognition is Vonage's only real asset. But the risk is that even more ubiquitous ads turns off new subscribers.
It remains to be seen whether Vonage's ad tactics will fend off cable operators now closing in on Vonage's industry leading VoIP subscriber total. The next few months are going to be crucial for the New Jersey-based company; any slip ups and cable operators will probably overtake them. But to their credit, Vonage has hung in there for a half year of more against giants like Time Warner Cable, which pushed its VoIP nationwide.
