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Vonage scores Circuit City deal

Thu, 03/04/2004 - 7:00pm
Jeff Baumgartner

Vonage dialed up a huge retail coup, inking a deal to sell VoIP equipment kits and services in all 600 Circuit City stores and via the retailer's Web site.

It marks the first national "brick and mortar" retail agreement for Vonage, which has more than 115,000 lines in service.

Amazon.com has been selling Vonage for more than a year, and Best Buy and RadioShack have been running retail trials with Vonage in some markets since last year, said Mathew Deatrick, Vonage's vice president of retail sales.

In the Circuit City deal, Vonage will offer a "starter kit" for $99.99 that includes a digital adapter from Motorola Inc. and two months of service. Vonage and Circuit City also will waive the $30 installation fee. The Vonage service requires a separate broadband connection.

In addition to getting a cut on Vonage kit sales, Circuit City will also get an "activation bounty" when the customers starts service, and receive monthly residuals thereafter, Deatrick said.

"We are in it for the long haul as so are they," he added, referring to the arrangement with Circuit City.

Circuit City adds yet another potentially lucrative sales channel for Vonage. The company also sells VoIP services directly and through wholesale and "private label" partnerships with EarthLink, Armstrong Cable, Advanced Cable Communications and the Coldwater Board of Public Utilities.

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