Vonage, Sprint settle patent dispute

Oct. 9, 2007 at 7:42 PM

HOLMDEL , N.J., Oct. 9 (UPI) -- U.S. Internet phone-calling company Vonage settled its patent dispute with Sprint for $80 million, agreeing to license Sprint's Internet-calling technology.

Vonage, one of the first companies to offer phone service via the Internet, drew fire from traditional phone companies that sought to shut it down, saying Vonage infringed on their patents, The New York Times reported Tuesday.

Vonage was ordered to pay $69.5 million in damages to Sprint after a jury found the Holmdel, N.J., company infringed on six patents. The settlement with Sprint includes a $35 million payment for the past use of patents, $40 million for future use and $5 million in “prepayment for services.”

“There was always this feeling that Vonage was revolutionizing the industry,” said Roger Entner, a senior vice president for communications at IAG Research.

What it did not do was take large carriers such Verizon -- which also sued and won a patent dispute with Vonage -- and Sprint seriously, Entner said.

“Vonage was put on notice,” he said, and similar services likely will review their technology to ensure they are not infringing on the carriers’ patents.

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