Vonage future looks troubled

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Sue Ebay for the Zero cost of Skype

Even though I realize they are spending way too much money. They do offer a full featured service at half the cost of most telecoms and no long distance charges for most of the world. I think one of their biggest problems at the moment is the zero cost of Skype. Now you have to understand that this is a problem because Skype does cost money to run, Ebay is using this to drive Vonage out of business. Now what do you all think will happen when they achieve this goal? This is why subsidizing a product in this way violates World Trade Agreements. Basically it is both anti-market and anti-competitive. Imagine if the Toyota offered free cars for a couple of years until there were no more auto dealers. It would cost them a lot but in the end they would be only company with a viable infrastructure to make and sell cars. The same thing actually happened locally when companies like Exxon and Shell chose to sell gas for below market rates causing many mom and pop stations to go out of business. Well we all see where that has got us. The law requires that a company not sell an item below cost for the sole purpose of destroying competition which is what appears to be happening here.

Posted by: alricsca   Posted on: 05/26/06 You are currently: a Guest | Members login | Terms of Use

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