Betting on VoIP
By Johns Wu on Aug 22, 2005
I’m starting to hear a lot of people talk about VoIP, especially Vonage, which means that its starting to become popular among consumers. I saw an opportunity to bet on VoIP, so immediately, I went to the Vonage website to lookup their stock ticker, but then I found out that theyre a private company.
I spent half and hour reading about VoIP stocks, and it seems pretty hard to invest in this new technology. Theres a ton of consumer VoIP providers, but theres so many of them, and theyre all so small that they’ll probably end up getting killed by competition from Vonage anyway.
However, VoIP equipment providers caught my eye. For instance, SONS was in the news last week. Finally, there are the wholesale VoIP companys like TLGB and IBAS. These companies use VoIP telephony to transmit tons of international phone calls from regular telecom carriers on a wholesale level.
I’m building up a list of VoIP stocks to watch. It’s unorganized and I’m sure I missed a ton of stocks, but here’s what I’ve come up with so far. I’ll be adjusting the list as I learn more about VoIP. Maybe I can even make a VoIP index.
3 Responses to “Betting on VoIP”
AIRN(Airspan Networks) is another possible play…
Looking back over the past 52 day period this stock has really slid. It seems to me that it is leveling out. From a market perspective it is the industries largest player spending roughly 20% of its revenue on advertising spend. Reasons for actions like this are for one of two reasons, distress or securing market position.
With its major competition being local cable companies they are in a market that is fragmented. This is great for Vonage. Look to companies like apple and their ipod for success stories entering fragmented markets. By blowing up their image, increasing their brand, coming out with new and ingenuitive products vonage should be able to create enough consumer pressure to generate some real value. If you ask me that is exactly what is going on with their advertising campaign. How many people have you heard this week humming the vonage tune? For me it has been quite a few.
Stock markets are generally slower to react to these changes. It takes time for the money to start rolling in.
Only one problem exists in my mind and that is the outstanding intellectual property suits. I am interested to see how they pan out. If Vonage wins this stock should shoot up again. If not they still have built a very strong brand and that has real value.
With increasing echonomies of scale Vonage seems to be in a pretty good place.
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AUDC looks especially attractive. Its fundamentals are quite good compared to the rest of the group and it’s venturing outside of its current downward price channel (http://tinyurl.com/dgysg). Probably not the best market to go long, but I’m definitely going to add this to my watch list.
(DISCLAIMER: This is not investment advice. I want to make it extremely clear that this is not a recommendation to buy or sell anything. Do your own research and consult a professional before making any investing decisions. This post should not be construed as professional advice.)