New Internet Phone Company Debuts

It's been a strange week for the Internet calling business. On Monday, SunRocket, a smallish competitor to Voice over Internet Protocol (VoIP) leader Vonage, abruptly shut down operations, essentially announcing to its 200,000 customers, "Uh, sorry." While the details of that mystery are still being teased out, a long-secretive venture called Ooma announced yesterday that it plans to offer a new device for Web-based phone calls this fall. The company hopes to compete with Vonage and Skype, and grab a share of what analysts predict to be a rapidly growing market for Internet phone calls. Ooma is grabbing attention because the company has big venture capital backers, and quite a few dollars behind it. But as this Business Week piece points out, their plan – customers pay $399 for a phone, then get free calls within the U.S. for life – probably won't sound all that sharp to veterans of the SunRocket debacle, who saw their provider abandon them without notice.—Gregory Mone