VoIP pioneer Vonage is failing to build on interest in the technology as its subscriber rate slows down.

The company gained 166,267 subscribers in the last quarter, compared to a gain of 204,591 in the previous quarter and a gain of 207,252 in the equivalent quarter in 2005. However, the company also reported an increase in revenue to US$181 million, up 91 percent from a year earlier. The company said that it was still on course to make a profit in early 2008.

The company now faces competition from cable operators and the established carriers. The big players have recognised the potential cost benefits of the technology as well as its flexibility, including the ability to give subscribers a browser-based portal for using voice mail and changing service preferences. And those big players are also bundling VoIP with other consumer services, such as broadband Internet access and TV.

Original story by IDG news service