Opinion on  Vonage Holdings Corp (VG)     Sector: Services  >  Industry: Communications Services
Vonage has a broken business. WCS shorted it a long time ago

Not only does this business have IP issues, it offers little to compete with the free Skype service from ebay....

At -60 million dollars per quarter cash use, and approx 400 in cash and marketable securities, there is only 7 quarters of cash left before zero and and only 100 in cash net of LT liabilities, surely this company is soon to be owned by debtholders....

This business is running fast at a brick wall, if you look at absolute cash and near cash items per share at the last quarter it's a share price of 1.78.  There's a chunk of liabilities so the net cash value is much lower.  You've really got to believe that some company is going to pay a huge premium for a churning price sensitive customer base and cobbled-together technology to believe a share price of even equal to cash, and then there's the winding up costs......

http://www.washingtonpost.com/wp-dyn/content/article/2007/09/...

To add to VG's headaches, they have to find a further $69.5 Million to pay to Sprint for damages and 5% of future revenues in royalties.  That's not going to help profitability.

Shares down 33% on the result, but they still should be heading to zero....