When Oak Hill resident Eli Lehrer started looking around for an alternative to his Vonage Internet phone service, he came across Vienna-based SunRocket Internet Phone Service.
At a lower price than his previous service, with a good set of reviews and a local address, Lehrer, an employee of a Washington think tank, knew he had found the right provider for his new personal home phone. A little less than one year ago, he signed up for two years of pre-paid service at $199 and became one of the more than 200,000 SunRocket customers nationwide.
While the service was "terrific," the reality of an independent Internet phone service operating against an increasingly competitive voice market soon caught up to Lehrer’s phone provider.
On the morning of Monday, July 16, the company abruptly cut service to a large number of its customers. While Lehrer’s service remained uninterrupted, he quickly got word from the Internet rumor mills that SunRocket had gone under.
At nearly 5 a.m. on Thursday, an email from the company confirmed the rumors: the company would be discontinuing service.
LEHRER’S CASE was not unique. More than a dozen people nationwide contacted The Connection with stories similar to his.
While calls and messages made to SunRocket Internet Phone Service’s corporate headquarters in the Tysons Corner area of Vienna were not returned, a message on its Web site left by the end of the business week had announced the discontinuation of service.
"After significant effort by the Company to avoid this result, SunRocket is in the process of discontinuing its operations as you know it," the web site introduction read.
THE PROBLEMS with SunRocket began when the company tried to take a corporate approach to a small start-up information technology firm, according to Jan Walter, a senior computer systems architect who lives in Arlington. Walter, a founding team member of SunRocket Internet Phone Service in April 2004, helped build and maintain the network that SunRocket operated before leaving the company in September 2006.
At its height, SunRocket served more than 200,000 customers and employed about 180 people, he said.
"In the end, they couldn't get enough customers because decisions couldn't be made with the flexibility that was needed in this type of company," Walter said. The slower pace of decision-making "stymied the ability of SunRocket to try new avenues to get new customers and it stymied the ability to get new technology to reduce the cost of getting and serving new customers."
"Here you are in a business that is rapidly innovating and there is a fundamental disconnect between how the two mentalities wanted to manage that."
Decisions couldn't be made in a timely manner to purchase new equipment that would limit the overhead costs and bottom line service to customers, causing the company to lose more money with each customer they signed on, according to Walter.
DESPITE THE CUSTOMER anger over the sudden closing, SunRocket was typically associated with a high level of customer satisfaction over the quality and pricing of its service, according to several customers.
But a business performance report listed by the Better Business Bureau of Metropolitan Washington, D.C. labels SunRocket as having an "unsatisfactory record due to unanswered complaints." There have been 399 complaints filed on SunRocket since October 2004, with 242 of those complaints coming in the last year, according to the report.
The regional office of the Better Business Bureau has received "a large number" of calls about the interruption of service and ways to recover funds, according to Judy Tankersley, operations director of the organization.
"If they truly are out of business, they’re out of business … all you really could do is line up at the bankruptcy court with all the other creditors," said Tankersley. "But it’s like a lifetime guarantee, if a company goes out of business, the lifetime is over."
Fairfax County's Department of Communication and Consumer Protection has received around 60 calls about SunRocket's service discontinuation since last Monday, according to consumer affairs branch chief Susan Jones. Her department is monitoring SunRocket to see if the company officially files for bankruptcy to be able to provide consumers with information on filing creditor claims, she said.
THE FINAL RESULT of SunRocket's service is an intrinsic risk in the voice over Internet provider industry, and consumers see the difference in their monthly bills, said Walter.
"These are people who paid less money because there were none of the same regulatory fees of the other telephone services," he said. "If people are willing to accept that, great, but they need to … be ready to accept this kind of result."
The reaction from former SunRocket customers has been stronger than when other services go out of business in the region, Jones said.
"The problem with this one is that it's telephone service," she said, "and with the loss of communication, the loss of 911 service, it's obviously an area of concern."
"In this day and age everyone needs a telephone."