Michael Snyder has resigned as CEO of troubled VoIP operator Vonage, effective immediately. The company also announced a series of cost-cutting measures designed to improve the company’s bottom line: the company will cut advertising by about $110 million, and will make an unspecified number of job cuts to lower general and administrative expenses.
Snyder will be replaced on an interim basis by Jeffrey Citron, who was Vonage’s chairman and CEO from January 2001 through February 2006. The company will launch an immediate search for a new CEO to replace Snyder. Citron said in a statement: "Mike has made valuable contributions to the growth of our business and we will miss him. We thank him and wish him well in his future endeavors." Vonage offered no explicit reason for Snyder’s resignation.
The company also announced preliminary financial results for the first quarter of 2007, claiming revenue of $195 million, a customer churn rate of 2.4 percent, and a $275 average marketing cost for each of its 332,000 gross subscriber line additions during the quarter.
Earlier this month, Vonage was barred from signing up new customers as a penalty for infringing on three Verizon patents related to VoIP services; Vonage managed to obtain a temporary stay of the injunction allowing it to continue signing up new users; an appeal is scheduled to get underway later this month.
