Vonage: Wall Street Sees the VoIP Challenge to Residential Phone

In the past two weeks, Banc of America and Merrill Lynch have both alerted investors that North America's residential telephone market faces potentially dramatic changes from VoIP challengers in the months ahead. New "virtual phone services," served over the Internet using SIP and low-cost telephone-to-Ethernet adapters, are now on the radar screens of the investment community because they could add to the wireless substitution trend and further erode the RBOC's residential phone business. VoIP cable services are seen as the largest threat. Both reports also cite Vonage and its broadband telephony service as a leader in a wave of independent "virtual service providers" that could take up any telephony voids left by cable.
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