OnlineChoice good supplier of customers, company says

A Pittsburgh-area Internet service provider and a Massachussetts utility services supplier will continue serving customers they obtained from OnlineChoice.com, the local Internet sales and marketing company that ceased operations Monday.

Stargate Industries, the region's largest Internet service provider, said its relationship with OnlineChoice was so new that it had received only around 100 customers from it.

'They were a marketing arm for us that we paid on a per customer basis,' said spokesman Shawn McGorry. Customers obtained through OnlineChoice will have their agreements honored, he said.

David Dane, president of Newton, Mass.-based ServiSense, said OnlineChoice provided about 10 percent of its 10,000 customers for bundled local and long distance telephone and electricity service.

'We'll miss the influx of customers we received through OnlineChoice, not only in Pennsylvania, but in New Jersey and California,' he said. 'They had maybe the best Web site, from a technical standpoint, of the companies competing in that space.'

OnlineChoice.com laid off its final 16 employees and filed for Chapter 7 bankruptcy on Monday.

It was formed in late 1999 as an online creator of buying pools of customers for essential services such as electricity, natural gas, telephone, wireless and others. It would negotiate for the best rates for these services to pass on to its customers, collecting a fee from suppliers for each customer provided to them.

The company had attracted $16 million in venture capital and hired and marketed rapidly. But by late last year it began laying off employees as its investors demanded it focus harder on becoming profitable. The layoffs eventually claimed its three founders, including its chief executive.

Dane said OnlineChoice had approached ServiSense regarding a merger, which ServiSense declined, opting to penetrate the market here on its own with mall kiosks and other direct selling methods.