Is The Collapse Of SunRocket Another Nail In Vonage's Coffin?

from the to-the-ground dept

The slow death of SunRocket (which has now been confirmed), has prompted a lot of discussion about how to move to a new service if you're a SunRocket customer. Obviously, any SunRocket customer is going to have a few inconvenient days as they try to make the switch to another VoIP operator, if they do so at all. Also, just as Vonage's woes made it harder for SunRocket to raise funds, SunRocket's collapse could end up hurting Vonage. If Vonage customers start to freak out that they could lose their phone service as well (a prospect made more likely by the ongoing litigation against the company), then they may preemptively flee, looking for a more stable service. The phenomenon, whereby doubts about some sellers end up hurting more reputable services, is what economists would call a market for lemons, and this would seem to be a classic example. Meanwhile, Vonage investors have fled the scene long ago, as Vonage shares languish at all-time lows.

Reader Comments (rss)

(Flattened / Threaded)

  1. identicon
    Special K, Jul 17th, 2007 @ 10:22am

    Gramatical Error?

    Is The Collapse Of SunRocket Be Another Nail In Vonage's Coffin?
    Don;t you mean Will the collapse or remove the "Be"
    Just trying to be helpful because it sounds too weird.

    But defenetly the collapse of SunRocket will do damage to small VOIP companies. May help some gain more customers but it's a warning

    reply to this | link to this | view in thread ]

  2. identicon
    Jon, Jul 17th, 2007 @ 10:26am

    Dear Vonage, Charge Me More

    My 500 minute plan is $22 a month after taxes, etc. If it were $27 or even $32 it would still be cheaper than my old plan with MCI - which incidentally was $65 a month. So, Vonage, if it means staying in business, you can increase my bill.

    reply to this | link to this | view in thread ]

  3. identicon
    Sunrocket Customer, Jul 17th, 2007 @ 10:37am

    3 cents a minute, international. Now who is gonna give me that rate !

    reply to this | link to this | view in thread ]

  4. icon
    JS Beckerist (profile), Jul 17th, 2007 @ 10:50am

    to #3


    reply to this | link to this | view in thread ]

  5. identicon
    C.G., Jul 17th, 2007 @ 10:59am

    To #4 et al...

    Skype sucks for most people because it is software based. Other products like Vonage and SunRocket actually replaced your physical phone letting people keep the convenience of their cordless phones at home, the usability they are used to, and the cheap rates.

    Grated, Skype is flexible but unless you get a Skype enabled phone (which most people don't have or even know what it is), Skype is going to be limited to techies who know what they are doing and are more interested in free than value.

    If Vonage goes under, my local cable company is one of my only options to get VoIP the way Verizon offered me a land line - through a phone I can pay $5 for at Radio Shack.

    reply to this | link to this | view in thread ]

  6. identicon
    EricW, Jul 17th, 2007 @ 11:16am

    I will hold out until the last minute because I have had nothing but excellent service and not a second of downtime or interruptions in all the time I have had them. I have the unlimited plan and a fax line that I use for my business and could not be happier with both. I hope for the best but if they go down I will be here until they go to the big dial tone in the sky.

    Of course I already have a backup plan in place to minimize any downtime for my fax machine but hopefully it stays a backup.

    reply to this | link to this | view in thread ]

  7. identicon
    Anonymous Coward, Jul 17th, 2007 @ 11:19am

    How about focusing in on Verizon being bottom feeding scum, that is basically trying to push out a viable competitor and force the consumers to pay more for service?

    reply to this | link to this | view in thread ]

  8. identicon
    Special K, Jul 17th, 2007 @ 11:35am

    Thanks for fixing the title
    and I got a question..
    If it's dead why the heck aren't they disabling the sign up feature?
    I doubt many people will sign up but they got no breaking news there to say anything. :(

    reply to this | link to this | view in thread ]

  9. identicon
    George, Jul 17th, 2007 @ 11:53am


    Had vonage for over two years. Love it. Also have skype, not as good quality in my case. Vonage is identical to "normal" land lines operation.

    reply to this | link to this | view in thread ]

  10. identicon
    SP, Jul 17th, 2007 @ 12:05pm

    ARGH!!! Stop saying independant VOIP will fail!!!

    Damnit Techdirt. Why must you insist that the fall of one VOIP company will cause all the others to fall down with them like dominos??? That's not going to happen. Vonage isn't "in trouble" or "doomed." If anything I think this will be great for Vonage -- a lot of SunRocket's customers WILL go over to Vonage. Wouldn't this create an increase in sales??? Why is that such a bad thing?

    Are you saying Vonage is going to fail because of Verizon's patent BS??? LOL. Pahleese! Read the press releases. Vonage has appealed and will not give up on this fight. Verizon is full of $hit and even if they "win" their stupid "you stole our patent" crap, Vonage is already working on ways to stay in business without "violating" any stupid patent laws. I've been a Vonage customer for 3+ years and they have never (and I mean *never*) let me down. They are more reliable than AT&T's overpriced landline service!

    Who cares about the damn stocks. Just because a company isn't doing the best on the stock market doesn't ALWAYS mean they are headed for failure. The idiots who are pulling out their stocks are the losers, not Vonage.

    Really sick of this "paid off media." TechDirt is starting to fall into this category. How much is Verizon paying you to keep peddling negative press towards independant VOIP providers?? I'd curious to know...

    reply to this | link to this | view in thread ]

  11. identicon
    James Pollitt, Jul 17th, 2007 @ 12:17pm

    Failure of Sunrocket

    As a Sunrocket customer I am shocked at the total collapse of Sunrocket. I have have the service for two years and for the most part I have been satisfied until the last 3 mos. I knew something was wrong when my service went in the toilet the last three months. I am still committed to Voip. I am also willing to go to Vonage.

    reply to this | link to this | view in thread ]

  12. identicon
    Charles "Red Beard" Griswold, Jul 17th, 2007 @ 12:25pm

    Re: Gramatical Error?

    Is The Collapse Of SunRocket Be Another Nail In Vonage's Coffin?
    Perhaps he be practicin' fer Talk Like a Pirate Day.

    reply to this | link to this | view in thread ]

  13. identicon
    TheDock22, Jul 17th, 2007 @ 12:50pm

    Re: ARGH!!! Stop saying independant VOIP will fail

    Wow, sounds like the fanboys are out and about today trolling for VoIP news.

    I do think it is sad another VoIP has bit the dust. It is such a wonderful technology and many businesses find VoIP services can save money. I think Vonage will be able to get through their legal troubles alright though. Hopefully it pays off for them in the long run because I would hate to give up my Vonage service. Although I can't give them rave reviews since I have had a few routers from them die on me, but the support people were very friendly and helpful.

    Telephone companies need to find a better way to compete with VoIP and not just slap companies around with lawsuits.

    reply to this | link to this | view in thread ]

  14. identicon
    Simon, Jul 17th, 2007 @ 1:30pm

    The only place Vonage is going is up

    So I'm sure a majority of you have heard about plans to increase the bandwidth of local broadband / fiber providers. I'm sure once that happens all the DSL users who pay an arm and a leg for their regular phone service, and brag that they pay a whopping $10/month less than you for internet access which is only 4 times slower than yours, will finally come to realize that they would be getting a much greater bundle if they were to finally abandon Quest/whoever and sign up for "Real" High Speed internet access and VOIP, and well, since Vonage is about the only VOIP company that actually takes the effort to advertise, the chances are it'll be safe for quite some time to come ;)

    reply to this | link to this | view in thread ]

  15. identicon
    Valor, Jul 17th, 2007 @ 7:32pm

    HUGE opportunity for Vonage..

    It's a little late now, but it is a HUGE opportunity for Vonage--if they take it.

    They should offer to honor any SunRocket Customer's time left on that they've already paid for, and port their number. Thing about it.. that's 200,000 free customers, overnight.

    DreamHost did a similar thing when some other domain registrar lost their license.

    reply to this | link to this | view in thread ]

  16. identicon
    Pon, Jul 18th, 2007 @ 4:26am

    Viatalk is picking up Sunrockets Customers

    I had Sunrocket for a year. I paid $199 for a year of unlimited calls with free equipment and cordless phones. They were a good company and I never had problems with my service. I had to dump them because I moved and they couldn't provide E911 in my new area. Now I've read on dslreports that Viatalk, a smaller voip provider, is offering to buy out existing Sunrocket contracts. Vonage better step up if they want a piece of that pie!

    reply to this | link to this | view in thread ]

  17. identicon
    jj, Jul 18th, 2007 @ 8:01am

    rip off artists technique

    It was quite obvious they wouldn't make it because of their "$199 a year prepaid all you can call" offer. Scam artists always want to get your money first before providing the goods

    reply to this | link to this | view in thread ]

  18. identicon
    Greg andrew, Jul 18th, 2007 @ 10:04am

    Actually, Vonage seems likely to cheaply pick up a significant number of customers for much less than they usually pay for customer acquisition; I think this will be a plus.

    SunRocket sent me far more offers than any other VOIP company, but I never even considered them; the only thing they looked good at was marketing.

    reply to this | link to this | view in thread ]

  19. identicon
    HASABELRASOL IBRAHIM, Jul 18th, 2007 @ 10:16am



    reply to this | link to this | view in thread ]

  20. identicon
    Gene, Jul 20th, 2007 @ 2:06pm

    Re: sunrocket customer

    go to .. they are giving a discount of $12.95 a month for the rmaining length of your existing sunrocket contract. Everything remains the same. The equipment, the number and the same services including the international rates. Good alternative from changing suppliers at least until your contract ends. Seamless change over.

    reply to this | link to this | view in thread ]

  21. identicon
    david, Jul 27th, 2007 @ 7:51pm

    Re: Dear Vonage, Charge Me More

    Try It's about 1/2 the price of Vonage. I'm pleased with my service with them for the last year.

    reply to this | link to this | view in thread ]

  22. identicon
    aaa, Aug 17th, 2007 @ 8:27pm

    SR rubbed the balance money on each contract from

    All SunRocket(SR) Customer,

    I was a SR customer, as I understand that SR played a bankruptcy game to the customer, it looks that they planned this game when they had a promotion for 199/yr plan, they rubbed the balance money on each contract from the customer, TeleBlend(TB) takes over everything from SR except contract, they just changed the company name from SR to TB.

    Do you have any idea to handle this issue, it is not a small issue, it is a big,big,big, huge issue, it is related to 200,000 customers

    We have to ask government to protect us to have it in fair, where is the government? where is the policeman? where is the lawyer? where is our congressman? did they know the issue or not?

    A SR Customer

    reply to this | link to this | view in thread ]

  23. identicon
    deane justin, Aug 22nd, 2007 @ 8:16pm

    I use Primus backed Lingo VoIP. It works prettily well. Lingo is financially solid and offers unlimited calling plans to over 230 countries. I can recommend Lingo confidently to all SunRocket victims who are interested in getting special promos.

    reply to this | link to this | view in thread ]

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