Vonage CEO Mike Snyder has just "resigned," effective immediately.
Founder and Chair Jeffrey Citron reclaims the CEO spot on an interim basis.
For anyone to suggest that Snyder's move is anything but an ouster at a time when Vonage's very survival is at stake would be wrong. You know, the stock price slid from $17 a share to $3 a share under the Snyder Administration, and the future of Vonage may well be known after the forthcoming April 24 patent infringement hearing.
My first take on what is going on here is that Snyder's happy talk and small moves (such as reducing some Vonage calls to a penny a minute) hasn't been sitting well with Vonage's board.
Cost cuts-many of which strike at the heart of Vonage's madcap advertising expenditure strategy- are going to be felt immediately.
"In order to strengthen Vonage's financial position, we are taking a number of measures to reduce our costs and operating expenses," said Citron. "We remain focused on improving our competitive position in the marketplace.'
Vonage plans to reduce its marketing budget for this fiscal year by $110 million, down to $310 million. Operations consolidation and staff cuts will be reduced by another $30 million, the company said this morning.
Such cuts would have to involve slashed payments to affiliates who promote Vonage sign-ups.
I'm betting that either Snyder argued for another way, and was overruled because of a need for drastic action, or was simply dumped as a sign to Vonage's beleaguered investors that the company realizes that matters are extremely critical and the company finally knows that.
I'm guessing that Citron- Vonage's largest shareholder by far- wants to execute something dramatic, such as a move to private ownership or a sale of Vonage's subscriber list to a traditional telco- and Snyder stood in the way.
More later today.