Vonage buys breathing space

Embattled internet telephony player Vonage may have given itself some breathing space by signing up a rival VoIP operator to carry its traffic.

According to a form filed by VoIP, Inc. with the Securities and Exchange Commission, the US-based VoIP operator has signed a deal to “provide certain network services to Vonage for their domestic customer base”.

The move comes days before the US District Court in Alexandria is set to cut off the company’s service.

The judge recently issued an order enjoining Vonage from using certain VoIP technology named in its patent litigation with Verizon.

By routing its traffic over VoIP, Inc’s network, Vonage avoids infringing on the disputed patents, as VoIP, Inc claims to own the patents for its transmission technology.

Last month, Vonage was ordered to pay Verizon $58m (£30m) plus monthly royalties for infringement on some of the US telco’s proprietary patents.

The award of $58m is much less than the $197m that Verizon had requested – partly because the jury found that Vonage did not act wilfully.

However, Verizon’s success has resulted in speculation that the company could go after other VoIP providers in a similar fashion.

Vonage claims that it relied on open standard, off the shelf technology when developing its service.