Anyone still excited about the Vonage IPO needs to be aware of the competitive landscape before taking the plunge. The latest squeeze attack on Vonage's prospects was Verizon lowering its VoiceWing prices to $24.95 a month from $34.95 - making it les expensive than Vonage. Meanwhile, AOL unveiled AIM Phoneline, which includes AIM Phoneline Unlimited that lets users make calls in 31 countries for $14.95 a month. These moves demonstate the ultra-competitiveness VOIP landscape, which explains why Vonage has little choice but to contineue spending heavily on marketing if it wants to attract and retain customers. The reality is Vonage can't afford to turn off the marketing pipe because once it's out of sight, it's out of mind - and there are no lack of rivals happy to step into the void. The window for a Vonage IPO was 2004, not 2006, if Jeff Citron and the company's VC investors wanted it to be a huge success. The Vonage IPO will happen because there are institutional investors who have little choice but to buy some of this (Vonage) to get some of that (the next red-hot IPO). But anyone who thinks buying into the Vonage IPO means they'll see a pop in the stock once it starts trading will be disappointed.
  My previous post on Vonage's IPO and its S-1 filing can be found here. Reuters also has a story on the IPO, including a quote from a securities lawyer who suggests the decision by Vonage's underwriters to raise the size of the IPO to $493-million from $250-million must be due to growing interest from investors. I'd be careful about making that assumption. There's a lot of marketing going on behind the scene to make the Vonage IPO happen, which could easily include new "developments" suggesting there is growing demand.