What the hell happened to ReachOut Wireless? The company, which we once ranked as the third largest free government cell phone company, has seen its Lifeline Assistance income plummet in the last three years and, according to our sources and contacts from several of our readers, it is no longer enrolling new customers in the Lifeline cell phone program.
As we’ve noted several times in the last few months, the free government cell phone sections (“Lifeline” sections) of the company’s website have been “Under construction” for months now. If you attempt to go to one of those pages, here’s what you see:
How, we wondered, could a company allow its website to be under construction for so long. Doesn’t it depend on that website for a huge percentage of its business? We decided to find out what was going on.
As we said above, a source revealed to us that ReachOut Wireless was no longer enrolling any new Lifeline Assistance customers. What is our source? None other than ReachOut Wireless itself, which would seem to be a good indication that the source is unimpeachable.
When we could get nothing but “Under construction” screens from ReachOut, we resorted to a bit of deception and clicked on the “Live Online Support” button on the company’s website. After asking a few questions, the support person revealed that ReachOut has exited the Lifeline Assistance business.
Here’s a screen capture of that online chat:
There you have it. One of the company’s representatives definitively states that ReachOut is no longer accepting new customers in the free government cell phone program. Seems conclusive, doesn’t it?
Charting ReachOut Wireless’ rise and fall
An entire industry was created in August, 2008 when Safelink Wireless gave away the first free government cell phone in Tennessee. Other entrepreneurs noted Safelink’s success and formed competitive companies as quickly as they could.
ReachOut Wireless was one of those companies. It tapped into this growing market and rapidly established itself as one of the industry’s leaders.
As you can see on the chart below, it rocketed from estimated* (as tracked by USAC.org) income of $6.6 million in 2009 to estimated* income of nearly $135 million in 2012. The company grew 526% in 2010, by another 119% 2011, and by another 49% in 2012.
* Estimates based on latest USAC breakdown of income per company. Source: USAC.org
Unfortunately, a chart of ReachOut’s free government cell phone income since 2012 looks like the downhill ski ramp at the winter Olympics.
ReachOut’s free government cell phone income in August 2015 was $1,586,276 compared to $6,587,185 in the same month a year earlier. We estimate that ReachOut had 170,000 customers last month compared to an estimate of 710,000 customers a year ago.
We wish we could say we’re surprised, but considering the remarkably poor way in which ReachOut has conducted itself with this website, we’re not surprised. Not at all.
FreeGovernmentCellPhones.net springs to life
FreeGovernmentCellPhones.net sprang to life to cover this growing industry in April, 2011.
Our goal since day one has been to promote the Lifeline Assistance program and the companies within that industry. One of the first articles we wrote was an overview and ranking of all the competitors. At that time we ranked ReachOut as the third largest competitor right behind Safelink Wireless and Assurance Wireless.
This website was an immediate success and spawned many competitors (most of whom came and went before anyone even knew they existed). Here we are more than four years later and we’re still — by far — the nation’s leading website dedicated to this industry.
We’ve established excellent working relationships with most of the large free government cell phone companies. They follow our readers’ comments and some use our comments section to respond to reader questions, comments and complaints. They realize that FreeGovernmentCellPhones.net is the best friend the Lifeline Assistance industry has ever had and treat us as a friend and ally. They respect us even when our readers register their complaints or when we editorialize against actions they may have taken.
ReachOut was among the companies that contacted us.
Our first contact with ReachOut
On September 24, 2012 we received the following email from ReachOut:
My name is Jeff ******, and I work on the customer compliance team for Nexus Communications d/b/a Reachout Wireless. We have been attempting to improve our customer service as well as our public image and have noticed that there is a sizable amount of our customers complaining on your website. We would like to address their concerns personally, would it be possible for you to provide us with the email addresses of the customers concerned?
We also have an email address you may want to add to our contact information. Our customers can send us questions and concerns directly to firstname.lastname@example.org, and we will address them as quickly as possible. Also, I noticed that in the FAQ section of your site you provide information on Assurance and Safelink’s plans. We would appreciate it if you were to include Reachout’s information as well, is there someone we should provide that information to directly?
Please get back with me as soon as you are able, as we would like to address these matters as quickly as possible. Thank you,
Assistant Project Manager Nexus Communications, Inc.
Since our entire raison d’être is to help needy Americans reap the benefits of the Lifeline Assistance free government cell phone program, we were eager to do whatever we could for ReachOut. The company’s request was not unusual. We are the largest website dedicated to this subject so it’s not unusual for companies to reach out (you’ll pardon the expression) to us.
We immediately replied to ReachOut’s email and told them that while we could not give them the email addresses of our readers (and their dissatisfied customers) for privacy reasons, we gladly added the company’s email@example.com contact information to its listing on our website.
Here’s a copy of that email.
I’d be happy to place your customer service address on the page for you. As for sending you the emails of the commenters, of course I can’t do that for privacy reasons.
If you could send me your current plan details, the same type of information we have put up for Safelink and Assurance, I’ll put a page up for your company as well.
We fully expected that this would be the first of many friendly contacts between FreeGovernmentCellPhones.net and ReachOut Wireless.
How wrong we were. Something — certainly nothing we did — went wrong at ReachOut. And if the company conducts itself with the rest of the world in the same Jekyll and Hyde manner in which it has dealt with FreeGovernmentCellPhones.net, we can’t say we’re surprised by the downward trajectory of its business.
Our second contact with ReachOut Wireless
In late April, 2013, just seven months after receiving that positive email from one ReachOut executive, we received a threatening letter the ReachOut’s heavyweight law firm. The firm has offices in Anchorage, Bellevue, Los Angeles, New York, Portland, San Francisco, Seattle, Shanghai, and is headquartered in Washington, D.C. One of the firm’s area’s of specialization is the Lifeline Assistance free government cell phone program. It is so involved in representing free government cell phone companies that it operates a website specializing in Lifeline law. Oddly enough, it is a site we often cite in articles about the free government cell phone industry.
To be blunt, ReachOut Wireless used its heavyweight law firm in an attempt to muscle FreeGovernmentCellPhones.net into submission.
The problem was that neither ReachOut nor its law firm knew what they were talking about.
Here’s a copy of that threatening letter:
I represent Nexus Communications, Inc. (“Nexus”), which provides Lifeline wireless phone service under the brand ReachOut Wireless. My client has invested considerable time, energy, and money to establish its ReachOut Wireless brand, provide excellent service to subscribers, and maintain the official ReachOut Wireless website, where potential subscribers can receive accurate information about ReachOut Wireless and Lifeline.
We have learned that through your website, www.freegovernmentcellphones.net you are disseminating inaccurate information about both ReachOut Wireless and the Lifeline program, including but not limited to false “reviews” of ReachOut Wireless and fake responses from “ReachOut Wireless Customer Compliance,” directing customers to the email address firstname.lastname@example.org.
This needs to stop immediately.
By presenting a website that uses the ReachOut Wireless brand and purports to provide responses from ReachOut Wireless staff to subscriber’s questions, you are likely to cause consumer confusion regarding the source of your website, and will likely cause consumers to mistakenly think that Nexus is affiliated with your website, when it is not. Creating such potential for confusion in the marketplace is a violation of trademark law, and is grounds for a lawsuit against you.
By presenting false reviews of the ReachOut Wireless, you are also interfering with Nexus’ relationships with existing and potential subscribers, and denying Nexus economic advantages of those relationships. That injures Nexus, and is grounds for a lawsuit against you.
By maintaining and promoting your website while engaging in the above conduct, you are also in violation California Business and Professions Code § 17200, which prohibits “unlawful, unfair or fraudulent business act or practice and unfair, deceptive, untrue or misleading advertising.”
Given all of the above, Nexus insists that you immediately and permanently remove all references to Nexus and ReachOut Wireless from your website by Friday, May 3, 2013. If you do that, Nexus will take no further action.
If you fail to comply, my client reserves its right to take the actions it deems necessary to protect the reputation, trademarks, and opportunities of its business including bringing a lawsuit against you requesting an immediate injunction, triple damages for your willful infringement, and recovery of Nexus’ attorneys’ fees.
This letter is sent without prejudice to any rights and remedies which Nexus Communications, Inc. may have, all of which are expressly reserved herein.
Very truly yours,
It was signed, of course, by an intimidating, high-powered attorney at the intimidating, high-powered law firm.
We felt like Faye Dunaway in China Town when Jack Nicholson started slapping her around to get information:
“ReachOut loves us. ReachOut hates us. ReachOut loves us. ReachOut hates us. Loves us. Hates us. Loves us. Hates us…”
There were only two problems with the high-powered law firm’s intimidating letter. (1) Nothing they accused us of was true, and (2) ReachOut’s right hand clearly didn’t know what its left hand was doing.
We ignored the high-powered, intimidating law firm, but on June 24, 2013 we sent the following email to the three executives who sent or had been copied on ReachOut’s original email to us:
To: Jeff *******
cc: Bo ******, Keegan ******
On September 24, 2012, you emailed FreeGovernmentCellPhones.net, and as a member of the Nexus Customer Compliance team, asked that we place the ReachOut Wireless customer service email address, email@example.com, on our Reachout Wireless reviews page. We were happy to oblige.
In October 2012, Reachout Wireless began posting comments on that page in response to negative comments from current and former ReachOut customers. Dozens of those responses were posted through April 2013. We assumed they really came from ReachOut Wireless since they were positive, generally offered to help solve customer problems, and had your correct customer service email address.
Although no website can verify each and every comment with 100% certainty, and has no obligation to do so, we did some due diligence to make sure they really came from ReachOut Wireless. Each of these comments has the same IP address (**.**.102.13), and that IP address resolves to Columbus, Ohio. We found that the Nexus Customer Compliance office is also located in Columbus. We still have all these comments and IP addresses on file. Given the IP address matched up, that you had contemporaneously requested that we place ReachOut’s customer service email address on the page, and that ReachOut’s comments consisted of polite offers to help resolve customer issues and provided the correct email address for contact, we believed (and, indeed, still believe) that they were from Nexus/ReachOut Wireless.
Now let’s get to the reason I’m contacting you today: We recently received a letter from **** ******** of the law office of *************, accusing us of creating the comments from ReachOut Wireless ourselves. We realize that it’s not uncommon in large corporations that the left hand doesn’t know what the right hand is doing. So may I suggest that you send a copy of this email, and a copy of your September 24, 2013 email to FreeGovernmentCellPhones.net, to Mr. ******** so that ReachOut’s lawyers understand what ReachOut’s Customer Compliance department is doing.
In addition to making that false accusation, they also accused us of creating “false reviews” (that’s legalese for negative comments from dissatisfied ReachOut customers). I assure you that the comments are all entered by real visitors to our website. With approximately 10,000 visitors a day, FreeGovernmentCellPhones.net gets far too many comments as it is. We have neither the time, energy or such a lack of grasp on the English language to make up the comments that are left on our site. In fact, we have deleted a number of comments that we felt were too negative and used language that we found objectionable.
Fact is, we have absolutely no reason to create negative comments about companies we are promoting, and who offer a service that we fully support. If we wanted to create false reviews, it would make far more sense for us to write positive comments that encourage more people to use ReachOut Wireless. Obviously, that would generate far more traffic for our site. In other words, positive reviews would help our website, not negative ones. The entire notion is completely absurd.
As I’m sure you know, no one supports the LifeLine Assistance program nor does more to drive business to ReachOut Wireless than we do. In the spirit of cooperation, we would suggest that it would be far more beneficial to ReachOut Wireless if your advertising and public relations people contacted us rather than your attorneys.
Since that date, we have had zero communication with ReachOut and its intimidating attorneys. Not an email. Not a letter. Not a phone call. Not a smoke signal. Nothing.
We are tempted to say that they’ve gone mute, but that is not technically true, because the company stomped its feet like a spoiled child and placed this message on its home page:
“We are not affiliated with: www.freegovernmentcellphones.net or obamaphone.net”
We’re not sure what ReachOut thinks it’s accomplishing with that statement. Were we supposed to feel some sort of guilt for covering ReachOut and the rest of the Lifeline Assistance industry honestly? Does ReachOut really think consumers were are so dimwitted that they might think a website that runs opinions that critical of ReachOut might also be perversely affiliated somehow with ReachOut?
We shook our heads in bewilderment and laughed at the addition of that statement to ReachOut’s homepage, because we believe it actually promotes our website and accomplishes the opposite of what ReachOut intended to accomplish by posting it.
For that reason, we never complained to ReachOut nor even commented on the statement. But now that ReachOut has become such an insignificant player in the Lifeline Assistance business, we take a bit of pleasure in revealing our opinion of the company’s inane tantrum.
But that was just the beginning of the hilarity surrounding ReachOut’s “We are not affiliated…” message.
At the time, obamaphone.net, while cleverly designed to look like an official, unaffiliated “Obama phone” website, was actually directing interested parties over to a company named qLink, which is one of ReachOut’s direct competitors. And today, even worse, keying in Obamaphone.net in your browser will immediately redirect you right to qLink. Oddly enough, no one at ReachOut seems to be aware of this error.
In other words, ReachOut screwed up twice by posting that disclaimer. First, it gave our website promotional “ink” we otherwise wouldn’t have received. Second, and even worse, it inadvertently (and stupidly, some might say) promoted a direct competitor.
Genius. Pure, unadulterated genius.
Where are the people now who sent us the email then?
Remember our initial premise. We launched this website to help promote the Lifeline Assistance free government cell phone program and the companies that compete in that industry.
When we received the initial contact email from Jeff *******, we were happy to be able to help and to establish a closer relationship with one of the industry’s leading companies. We assumed that the letter had been sent by a bright, aggressive, young executive who was going places in the world.
So we wondered what happened to Jeff, who sent the initial email, and Bo and Keegan, the two co-workers who had been copied on the initial email from ReachOut. Have they been promoted? Have they prospered? Has senior management recognized their creative potential and rewarded them with greater responsibilities within the ReachOut empire?
It doesn’t look like it. As far as we can tell from LinkedIn listings and newspaper articles, we believe that this is the fate of the three young men who tried to do the right thing for their employer:
- Jeff appears to now be an aspiring stand-up comic.
- Bo appears to be an aspiring actor/model and lead singer/guitarist in a rock band
- Keegan appears to be attending law school.
We know nothing about Jeff, Bo, and Keegan (last names withheld to protect the innocent) except that they attempted to strike up a relationship with a website that could have been of great benefit to their employer.
We don’t know why they left ReachOut. But we do know that, in our humble opinion, these three are probably better off attempting to do something new and creative with their lives than they would have been had they attempted to build a career with a shortsighted company like ReachOut.
Let us know if you need any help, guys. FreeGovernmentCellPhones.net will give you whatever help we can.
ReachOut’s record with customers
ReachOut is owned by a Columbus, Ohio-based company named Nexus Communications. It looks as if the geniuses running ReachOut/Nexus have problems far larger than the comments left by their unhappy customers at FreeGovernmentCellPhones.net. Problems, that is, with a major consumer affairs watchdog.
We looked up Nexus’ rating at the Better Business Bureau and it is not good. In fact, it’s difficult to imagine a company being rated any worse than Nexus.
Nexus has had 430 complaints closed with BBB in last 3 years and 98 of those occurred in last 12 months.
|Complaint Type||Total Closed Complaints|
|Problems with Product/Service||342|
|Total Closed Complaints||430|
Yes, you’re reading that chart correctly? ReachOut/Nexus has had 430 complaints closed in the last three years. FreeGovernmentCellPhones.net, in contrast, has had one complaint in the last three years. It came from the company that had provided such horrible service that 430 customers felt compelled to report it to the Better Business Bureau.
You can go to the BBB website and read the complaints for yourself. Then, just for fun, you might want to visit ReachOut’s page here at FreeGovernmentCellPhones.net. Perhaps it mere coincidence, but the complaints you’ll find on both websites sound remarkably similar. They paint a picture of a company that provides faulty products, inferior service, and doesn’t seem to care what its customers have to say.
Perhaps that explains why ReachOut’s Lifeline Assistance business has fallen off a cliff.
In the words of Jim Morrison, “This is the end”
We’re not fortune tellers. No one knows what the future holds. Will ReachOut Wireless turn its fortunes around and prosper once again? Will they segue into a completely different business and rise like a Phoenix from the ashes of the free government cell phone program?
Perhaps Jim Morrison and the Doors expressed it best in their 1967 hit titled “This is the End”.
This the end, beautiful friend
This is the end, my only friend, the end
Of our elaborate plans, the end
Of everything that stands, the end
No safety or surprise, the end
I’ll never look into your eyes, again
Only time will tell. But there is one thing we know. ReachOut Wireless would be in far better shape today if they had worked with us instead of against us.
Note: If representatives of ReachOut Wireless, its parent, Nexus, its high-powered intimidating law firm, or any other interested parties feel we have made any errors in this article, they are invited to respond with their versions of the facts.