Sun Rocket Sets a New Floor for VoIP

Sun Rocket, in a bid to gather some much needed momentum, (and spend the $25 million it raised recently) is introducing a new $10 a month limited VoIP service, that gets you 200 minutes outbound and unlimited inbound minutes. (It has to do something – nearly $34 million in total VC dollars and 50,000 customers!) Of course you could spend another $5 and get extra 300 minutes from Vonage which offers a similar package but with 500 minutes for $15 a month. (Sun Rocket’s additional minutes and extra line prices are lower than Vonage, however!) Sun rocket also offers an unlimited $199 a year plan, which is much more attractive than its new offering but is a bit pricey as a lump sum payment. How long do you think others are going to take to respond?

This offer shows the quiet desperation in the business. VoIP-based phone services are growing, only for those who are providing near free services like Skype or others who sell it as digital phone, aka the cable companies. There is very little room for independents in this business, unfortunately. Regardless of all that, this is part of a continuing trend of constant commoditization of the voice, and a silent price war between the independent service providers. This also shows the lack of imagination on part of service providers who are using price as their only tool. Going back to today’s news, Sun Rocket’s new offer is attractive for those with a limited need for a quasi landline but I wonder how much stress it is going to put on their infrastructure. The company’s network and infrastructure has buckled many a few times in the past, irritating the customers.