As as VOIP enthusiast, and as a Vonage customer, I have been following the Vonage vs Verizon case with curiosity, and anxiety. Breaking news for today is that Vonage CEO Michael Snyder has resigned. Chairman Jeffrey Citron is the interim CEO.
Vonage also presented its results for the quarter ended March 31, 2007:
-- Total Revenue (in millions): $195
-- Gross Subscriber Line Additions: 332,000
-- Net Subscriber Line Additions: 166,000
-- Average Monthly Customer Churn: 2.4%
-- Marketing Cost per Gross Subscriber Line Addition: $275
In phone call with analysts this morning, Citron said that Vonage would cut its marketing expense of $275 per new customer acquired. FierceVOIP magazine thinks the above is "actually $31 better than it had been in the previous quarter."
But I am really surprised by the $275 number there. I am not an industry expert in VOIP, and I probably don't need to be one to ask this question: Why is it not around $50 or $100 at max, which will put it more in line with % marketing expense of internet technologies?
I haven't got the customer mix (business vs home) handy, but I do often see a Vonage leaflet in London's Financial Times, and then some online ads and campaigns...but still $275 looks big! I am now very curious to know what marketing channels Vonage is using for a product like VOIP.
Let's see where Citron cuts the marketing expenses...he won't need to search much! We will follow this story.
On a slightly separate note, their service and support has been great though...and full marks on that aspect.
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