Business Snippets – From FairPoint and Yahoo! to Nortel and Vonage

A roundup of hot business happenings in telecom:

FairPoint creditors are ramping up pressure on the bankrupt LEC to make good on unpaid bills. They’ll have to wait a while for resolution, though. FairPoint’s situation is a lot like Nortel’s in that a third party handles these claims and the bankruptcy court will decide who gets paid and when.

Modavox is suing Yahoo!. Look, there are all kinds of vague Internet patents floating around out there. If Yahoo! really is infringing, well, that’s a problem. But Modavox’s timing sure raises the question of whether the company is desperate to find new ways to make money via patent licensing and royalties – it continues to record millions in quarterly losses, much as some people hate to see that pointed out (thank you, SEC filings). So, are Modavox’s efforts survival of the fittest or attempts of the desperate to survive?

The AT&T-Verizon spat over 3G advertising continues. Recall that AT&T has sued Verizon for its “There’s a Map for That” ads and has asked the courts to pull the TV spots. Now Verizon has lobbed its response, saying snarkily that AT&T is just ticked because “the truth hurts.” Watching corporate snippiness play out has rarely been this much fun.

AOL is finally spinning off from Time Warner. It’ll be its own publicly traded company as of Dec. 10 and new CEO Tim Armstrong will be living under the microscope. Investors and the industry want to know if he can evolve the one-time Internet king from dial-up connoisseur to content and advertising connoisseur. If not, maybe EarthLink will make that long-speculated acquisition.

Nortel just reported another quarter of losses. But did anyone expect any other outcome? It’s tough to see how an insolvent company that’s parting itself out, laying off workers, fighting pensioners and otherwise crumbling could manage to turn a profit. Nonetheless, Nortel did trim those losses from last year’s results, although due to the way it records its operations and because of the many administrative cutbacks it’s implemented. Still hate to see this company die.

Vonage is paying about $3 million to 32 states in a settlement over unfair business practices. The VoIP provider didn’t admit guilt but it is changing some of its operations. For one thing, it’ll make sure to clarify that its service requires broadband. Okay, now, I would think you have to be pretty out of it not to understand that making a phone call over the ‘Net requires high-speed access. But there are a lot of older folks who may not get that and, hoping to save money on fixed incomes and in a recession, latched on to the idea of cheaper phone service. And it seems Vonage took advantage of some peoples’ ignorance. Then, when it allowed the users to cancel their accounts, it charged them a bunch of fees, the states say. If that’s true, Vonage, that’s just low. You’d think this would be one company that would be hyper-vigilant about its reputation, after all those patent infringement lawsuits and shareholder uproar. That doesn’t appear to be the case.