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SunRocket VOIP Phone Service Folds Today

By Laura Trowbridge     Jul 16, 2007 in Business
Today 200,000 customers lost their phone service. I am one of them. Since late this afternoon we were without home phone service. My husband has always been able to reset the box and restore the phone service when it has gone out before.
When he got home tonight he tried and tried to get the service working, all to no avail. Later he tried again to get it to work until I told him to just call SunRocket customer service on his cell phone. He got a recording saying the company was no longer taking customer service or sales calls.
He came back to the computer room where I was and said, "Uh oh, looks like the company might be out of business!" He went onto Google News and typed in SunRocket to see if there was any information on what was going on with the company. He pulled up many stories of their shutting the company down.
This was quite a shock to us as we had not heard a single word about any trouble with the company. We were on the $199 a year plan and were paid up until February of 2008.
SunRocket was founded in 2004 and became the second largest internet phone start-up company, just behind Vonage. As of April 2007 SunRocket had 200,000 subscribers.
These internet phone-service-only companies are under pressure from the competition of cable and traditional phone service providers. Cable companies are especially pushing into the market with their combination packages of tv, phone and internet.
Companies like SunRocket and Vonage only offer one service and cannot control quality because they do not own the high speed internet lines they operate off of. This is a disadvantage compared to the cable and traditional phone companies.
In another internet post there was a report of an internal message sent to SunRocket remaining employees (many had been already laid off weeks ago) stating:
"Unfortunately this email contains very bad news. We have just been informed that any and all last ditch efforts to keep operations running as well as a potential sale of the company have not gone through and that SunRocket will cease operations at COB today. As such, today is my last day and everyone else you may have worked with at SunRocket. … Regarding outstanding and future invoices: Sherwood Partners out of Palo Alto will be handling the close down of all invoices, current and outstanding."
It was claimed that SunRocket was moving its customers to other VOIP companies. That certainly did not include us. We were abruptly cut off without warning and scrambled to find another company before I posted this story.
We are going with ViaTalk who also offers the $199 a year unlimited calling, and they will buy out our remaining contract from SunRocket that we prepaid.
Unfortunately, we will not have home phone service for up to 5 days, or longer. Our cell phones rarely work inside our home for some reason, so I'm pretty much screwed for keeping in contact with my loved ones this week, other than email.
Vonage went public last year, but the company has had its share of troubles as well. Their stock has not been doing very well recently. Although they have been gaining customers they have lost $73 million in the first quarter of this year.
An analyst said he thinks stand-alone Internet telephone companies could wind up as successful niche players in the market, but that their investors would have to be willing to endure a substantial period of losses before these companies built enough of a customer base to be profitable.
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