|
Vonage CEO Jumps Ship |
|
|
|
Written by Adam Gosling
|
|
Friday, 13 April 2007 |
Vonage Chairman, Jeffrey A. Citron, is
left to tidy the deck chairs at the beleaguered American broadband
phone provider after the sudden departure of CEO Michael Snyder.
The
company, which last week narrowly escaped (or delayed) being capsized
by the courts after a Judge issued a stay order pausing an injunction
that would see Vonage blocked from signing new customers.
After
being found guilty of infringing three Verizon patents that relate to
its Voice over IP telephony services, Vonage is fighting for its very
survival. Ahead of an appeal against the conviction and US$58 million
penalty, the company has now announced it plans to cut deep into its
marketing and staff budget to save US$140 million in the next 12 months.
Effective immediately CEO Michael Snyder has stepped down from his job as Chief Executive Officer and has resigned
from the Company's Board of Directors. Jeffrey A. Citron, the Company's Chairman,
has been appointed interim CEO until Vonage can find a replacement for Snyder.
The
Company also announced its preliminary estimation of its
operating and financial results for the quarter ended March 31, 2007
which included US$195 million in revenues against US$275 in marketing
costs. For that investment, during the Quarter, Vonage added 166,000
subscribers (net). The Gross Subscriber Line Additions was 332,000 and
average monthly churn was 2.4 per cent.
The broadband phone service provider, which also has operations in
Europe says it is soon to reach the 3 million customer milestone.
The
cost cutting measures will strengthen Vonage's financial position to
maintain the company's competitive position in the marketplace,
explained Citron.
While the marketing budget will be trimmed by US$110 million it
still plans to spend roughly US$310 million for marketing in 2007.
The Company also announced plans to reduce its G&A by $30
million through the remainder of 2007 through consolidation of
operations and workforce reduction. According
to reports a freeze on staffing levels and a planned workforce
reduction of 180 workers will see about 10 per cent of the company disembark along with Snyder.
Related news items Newer news items
Older news items
|
|
|
|
