David Christian of Eagan, Minn., has been doing the landline shuffle. He's among the 25 percent of Americans who have dropped traditional phone service from providers such as Qwest and AT&T, according to the National Health Interview Survey released last week. Many of them replaced the landline with a cell phone. But Christian and other customers who prefer a home-based phone save $40 to $50 a month by using an Internet-based service -- or Voice over Internet Protocol (VoIP).
After trying other VoIP systems, Christian finally settled on Ooma as the best replacement for his Qwest service.
"I have never had a problem with Ooma," he said. "I am so happy that I got my brother in Milwaukee to sign up, too."
But Ooma is only one of many VoIP choices, including Vonage, Skype and magicJack.
Vonage and Skype scored near the top of Consumer Reports' reader ratings for value, but reliability and call quality were rated "average" or below. Skype is usually free for voice and video calls if you install free software on your computer, but your computer must be left on to receive calls. Skype charges for calls to regular phones and to receive incoming calls. Vonage VoIP costs $216 per year for a basic plan.
Consumer Reports editors were more impressed with magicJack. It's a $40 device that plugs into your computer's USB port and allows you to make unlimited local and domestic long-distance calls through the Internet for $20 per year. Voice quality was rated as being good, although if you're talking on the phone while downloading a file or playing a game online, expect interference.
After reading online reviews, I decided to try Ooma (untested by Consumer Reports). I had dropped Qwest a year ago when Comcast offered digital phone service with long distance for $15 a month for six months (regularly $45 per month), but I decided not to continue past the promo period. I bought an Ooma Telo unit at Costco.com. For $200, I no longer have a monthly phone bill, and I can make unlimited local and long-distance calls within the United States. I also paid $40 more to keep my phone number.
I'm not tech-savvy, though, so I asked a knowledgeable friend to help with the setup. That's also the reason I bought from Costco, which accepts returns for any reason. My friend hooked it up in about 40 minutes. The Telo unit is an adapter and an answering machine that plugs into a broadband Internet connection and your existing house phones.
After several months, I'm still tickled that I drop-kicked one monthly bill. I will break even at six months. I'm satisfied with Ooma so far. While the voice quality isn't as good as a landline, it's better than a cell phone. However, I've occasionally encountered a slight voice delay and I have difficulty checking my work voice mail from home because the automated system doesn't always recognize the Ooma keypad tones. On the positive side, running Ooma through a somewhat pokey USI Wireless connection hasn't been a problem.
READERS WEIGH IN ON VOIP
Readers who responded to my blog request for their thoughts on Ooma and magicJack were nearly unanimous in their praise of Ooma. Most have had the service for six months or more. Surprisingly, most also pay $120 per year extra to get Ooma's optional Premier service, which includes a second line, three-way conferencing and call-blocking.
Two of the 30 readers who responded had complaints, which included a few dropped calls and poor customer service and support. Ooma, which has 100,000 subscribers, has grown so quickly that customer service has suffered in the past four months, said Tami Bhaumik, vice president of marketing. But she expects the issue to be remedied within two months.
VOIP SYSTEMS READILY AVAILABLE
You can purchase VoIP systems through the company website or mainstream retailers, such as Target and Wal-Mart. Best Buy sells magicJack for $40 and has the Ooma Telo system on sale now for $200. Amazon.com also is selling the Telo for $200, shipped. Costco.com is selling the Telo plus a handset for $230 delivered. (Nonmembers pay 10 percent more.)
Ironically, I chose Ooma because it had no monthly bill. Now it does. Ooma and other VoIP providers now pay higher taxes, and they are passing those fees on to new customers. For example, anyone buying Ooma now is charged $3.47 a month. It's still less than Qwest, Vonage and magicJack, but proves that there's no such thing as free service. (Ooma subscribers who signed up before April 5 don't have to pay the monthly fees -- for now.)
As for Christian, he liked Ooma so much that he packs up the system and his laptop and takes it with him when he visits his brother.
"When we travel, people call us and don't even know we are in Milwaukee," he said.
Explore further: Creating the fastest outdoor wireless Internet connection in the world