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MICHAEL BLUEJAYaward-winning writer

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Vonage vs. magicJack vs. Skype vs. oomavs. CableWhich one is best?

Last update: January 21, 2011

What a difference a few years makes! Ten years ago you had one choice for local phone service: the phone company. Now you've got

several, and they all cost less than the phone company. That's great! But now you've got so many choices it may be hard to choose. So

that's what this page is for, to help you sort through your options. And rather than make you read the whole article just to get the punchline,

here's a handy summary right up front. (And by the way, I personally use Vonage.)

Vonage magicJack Skype ooma Cable

How it works Black phone box,

plugged into your

(wired) Internet,

phone plugs into the

box

USB device plugs into

your computer, phone

plugs into the USB

device

Software app on

your computer. No

extra hardware

needed.

Phone box, similar to

Vonage, but with a

speaker and buttons for

voicemail.

Standard phone

outlet on your

wall, installed by

your cable

provider.

Call quality Fair to Very Good

my calls to Japan are

better on Skype

Fair to Very Good (if

your computer is

powerful enough)

Fair to Very Good

my calls to Japan are

better on Skype than

Vonage

Good to Very Good Very Good

Initial cost none none none $200 to $250 none

Monthly cost $10-$35/mo. $1.67 to $3.33/mo.

(paid as $40/yr. for

the first year, and

$20/yr. for future

years)

$0 to $14/mo. for

outgoing calls.

Incoming phone # is

optional, and costs

$5/mo. (paid as

$60/yr).

$0 to $10/mo. $50/mo. (Some

offer promo

rates of $30/mo.

for the first

year. Price

depends on

provider.)

Per-minute

charge for U.S.

calls

none none 0¢ to 2.3¢ none none

Free local &

national

minutes per

month

200 to unlimited Unlimited 0 to unlimited Unlimited Unlimited

International

calls

Free to over 60

countries with

Vonage World plan.

Otherwise, pretty

cheap. (See rates.)

Never free, but cheap.

See rates.

Free to 40 countries

with $14/mo. plan.

Otherwise, pretty

cheap. See rates.

$5 to $10/mo. for 500

to 1000 minutes/mo.

Cheap

Use existing

phone

Yes Yes (but you can also

use your computer's

mic/speakers, or a

headset if you prefer)

No; uses computer's

mic/speakers or a

headset.

Yes Yes

Use existing

phone # (if

you prefer)

Yes Not yet. As of Jan. 2011

they're beta-testing that

feature. It'll cost extra

when it's available.

No Yes ($40 fee, or free if

you prepay the

$10/mo. plan for a

year)

Yes

Use multiple

phones in

same house

(1) Use normal house phone wiring, or (2) Use

a cordless base with multiple handsets., or (3)

Get a multiport adapter from Radio Shack and

run phone cords to each room.

Skype doesn't use a

phone, it uses a

headset with your

computer. You can

use it from any

computer in the

house.

Same as #2 and #3

with Vonage. To use

house wiring, you need

a $61 adapter for

phone #3 and each

additional. (The first

adapter for phone #2 is

free.)

Same as

Vonage.

CallerID Yes Yes Yes Yes Yes

Call Waiting Yes Yes Yes Yes Yes

Voicemail Yes Yes Free with monthly

calling plan,

otherwise $6 for 3

mos.

Yes Yes

Three-way

calling

Yes Incoming calls only.

But you can set up a

free conference call on

this website.

Yes. In fact, handles

conference calls with

up to 25 people.

On $10/mo. plan Yes

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of 5Vonage vs. MagicJack vs. Skype vs. Ooma - a comparison

2/14/2012http://michaelbluejay.com/consumer/phone.html

Requires high-speed Internet

The first thing you need to know is that all these options require high-speed Internet, except for the cable option. So if you don't

have high-speed Internet, you either have to get it, or cable phone is your only option.

Despite the fact that the calls go over the net, with most of your choices the experience is the same as with a regular phone. In fact, you

use your same, regular phone, and it sounds and works just like a regular phone. The only exception is Skype, for which you'd use a

headset, or your computer's internal mic and speakers.

Get a U.S. phone number even if you live in another country

So far as I know, all of these services besides cable let you get a U.S. phone number, no matter where in the world you are.

That allows you to make and receive U.S. calls on the cheap.

Vonage

Vonage sends you a little black phone box (for free). You plug it into

your cable modem, then you connect your computer and phone to the phone

box. This is easier to understand with a picture, so I made one. See the

picture at right..

The cheapest plan is $10/mo. which includes 200 minutes to

anywhere in the U.S. But the real value is Vonage World, which gives you

unlimited calling to the U.S. and 60 different countries for only $26/mo. If

you have friends or family overseas, this is nothing short of incredible.

However, my calls to Japan sound much better on Skype.

I signed up for Vonage way back in 2004, paying $15/mo. for the cheap plan. I've saved over $2000 from the $45/mo. I was

paying to my local phone company before. It gets better, if you sign up on this special page and enter my phone number (512-322-

0638), Vonage will give you the first three months of the $26/mo. plan for only $15/mo. (Full disclosure, they give me a free month of

service when you do that, but dude! I'm totally hooking you up!)

A nice bonus is that it's great for travel. When I went to Japan I just threw my Vonage box into my suitcase, and then in Japan I had

my regular U.S. phone number. My next-door neighbor in Austin could call me and it would ring on my desk in Japan! But remember

that the Vonage box does need a wired Internet connection to work, so if you're in a hotel that has only WiFi, that's a no-go.

Voicemail is stored on a central server, so you can access it from any phone. They can also email a .WAV file to you, and with

the $26/mo. plan they'll also include a text transcription of the message.

Vonage has some serious competition from ooma, but a couple of the features I like cost more with ooma (voicemail-to-

email, and international calls). So for me, Vonage is cheaper. But if you're not making international calls, ooma will probably save

you some money.

Sign up for Vonage on this special page and enter my phone number (512-322-0638),

and Vonage will give you the first three months of the $26/mo. plan for only $15/mo.

MagicJack

(Actually, anyone can,

not just MagicJack

customers.)

Send SMS text

messages

- - 5¢/message - -

911 service Yes Yes No. (But can dial 7-

digit # for police or

fire.)

Yes Yes

Good for travel Fair (phone box + a

phone to lug around)

Good (can use your

laptop's mic/speakers,

or a headset)

Awsome! (works on

your laptop w/no

extra hardware)

Fair (phone box + a

phone to lug around)

Impossible

Downside Computer must be on to make/receive calls. If

your computer doesn't run 24/7 normally, you

could spend hundreds of dollars a year for

extra electricity to keep the computer going.

Also, MagicJack displays ads on your computer

(which is how they can offer the phone service

so cheaply).

Might need an adapter

to connect 3 or more

phones, at $61 for each

extra phone.

Not any cheaper

than regular

local phone

service + a

calling plan.

Conclusion Great value, tons of

features. Sign up

on this special page,

enter my phone

number (512-322-

0638), and get

$10/mo. off for your

first 3 months.

The cost is low but that's usually more than

offset by the electricity required to run your

computer 24/7. Great for travel, though. (Visit

magicJack or Skype)

Cheaper than Vonage,

but if you want lots of

features and

international calling,

Vonage is cheaper.

(Visit ooma)

Not any cheaper

than regular

local phone

service plus a

calling plan.

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You've seen the commercials, so you know how it works: You plug

the little USB adapter into your computer, then plug your phone into the

adapter. It's that simple. (You can also use your computer's mic/speakers

or a headset if you prefer.) Best of all, the MagicJack costs only $40 and

includes a whole year worth of unlimited nationwide calling. And your

second year is only $20. Call quality is fair to excellent, depending mostly

on how powerful your computer is.

The catch is that your computer has to be on 24/7 to receive calls,

and the extra electricity to power the computer can easily erase

much of your savings. If you've got a 150-watt computer system that's

on an extra 18 hours a day, then at a sample cost of 15¢ per kilowatt hour,

you're gonna spend an extra $150 a year in electricity for the computer.

Bye-bye, savings. Now, if your computer is already on 24/7 anyway, then

there's no extra electricity cost, but if so, do you really need to run your

computer 24/7 to begin with (and to pay to do so)?

MagicJack is great for travel, though. (Visit the MagicJack website.)

Skype

Skype is the only service that needs no hardware. You just download the software and it runs right on your computer. If your

computer has a built-in microphone and speakers, you can talk and listen through that. If it doesn't, you can just plug in a cheap headset

to your computer.

You can skip the monthly fees and just pay a couple cents per minute for calls. Or you can go with a cheap monthly plan (up to

$14/mo.) which gives you unlimited calling.

All that's for outgoing calls. If you want to receive calls on a real phone number, that's $5/mo. extra. Also, Skype is the only service

that doesn't let you transfer your existing phone number. So if you want to receive calls with Skype, you're gonna get a brand-new

number. And while we're at it, Skype is the only service that doesn't have 911 emergency dialing. (The workaround is to find your local

police department's 7-digit phone number, and add that to your phonebook, for a simple double-click to call.)

Like MagicJack, Skype requires your computer be on 24/7 to receive calls, and the extra electricity to power your computer can

quickly erase your savings. So for your regular phone, Vonage or Ooma is a better choice. But Skype is absolutely fantasticfor travel. If

you've got an Internet connection for your laptop, even WiFi, you've got a phone. And if you need outgoing calls only, you don't even

need a monthly plan. I also prefer Skype over Vonage for occasional calls to Japan, since the quality is much better with Skype. (Visit

the Skype website.)

ooma

ooma is a lot like Vonage: they send you a special phone box, which you plug into your Internet connection, and then you

plug your phone into the box. The main difference is their pricing model. With Vonage you pay nothing up front and just pay the

small monhly fee. With Ooma you pay $200 to $250 for the box, and then all your calls are free. So ooma costs a little more to get

started, but it has the potential to be a lot cheaper in the long run.

ooma offers a monthly plan for $10/mo. which includes some extra features. But even with this extra plan, ooma is still often

cheaper than Vonage even after just a year.

To make international calls with ooma, you have to buy a $5 or $10/mo. plan. You don't have the ability to just make

international calls at a low per-minute rate on the fly like you can with Vonage. So note that with the $10/mo. for the extra features, and

$10/mo. for international calling, suddenly ooma's $20/mo. isn't much less than Vonage World for $26/mo. And with Vonage there's no

equipment to buy.

That's why I haven't switched to ooma. I make international calls, and I want my voicemail files sent to my email. That's cheap or

included with Vonage (depending on the plan), but these features would cost me $20/mo. with ooma. Even after five years, a Vonage

World plan would still be cheaper than ooma plus the extras. So with a long payback time for ooma, I'll stick with Vonage. It's cheaper

for many years, I'm happy with the service, and I don't want to hassle with porting my phone number to a new service.

Choosing between Vonage and ooma can be hard, so hopefully this table will make the decision easier:

Vonage oomaVonage Lite

(200

mins./mo.)

Basic 500

(500

mins/mo.)

Vonage World

(unlimited)

no plan

(unlimited)

w/Premier Plan

(unlimited)

Initial cost none $225

Monthly cost $10/mo. $18/mo. $26/mo. none $10/mo.

Total for 1 year $120 $216 $312 $225 $345

Total for 3 years $360 $648 $936 $225 $585

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Cable ("Digital Phone")

Cable TV companies like Time Warner and Comcast are now offering local phone service. The problem is that it's not really any

cheaper than what your regular phone company offers. Oh sure, there's a great introductory rate, but how much does it go up to after

the promo expires? That's not a rhetorical question, because they don't tell you how much you'll be paying once the special rate is over.

Not in their come-on junk mail, and not on their websites where they want you to sign up. They actually expect you to sign up for their

service without telling you the normal monthly rate! That's just sleazy and rude. For this reason alone, I would never get cable phone

service. (Even if it were cheaper, which it's not.)

What are the downsides of these services?

Power & Internet. If the power goes out or your internet connection goes down, so does your phone.

Microsecond Delay. There's a delay of up to half a second between when one party starts speaking and the other side hears them.

That might not sound like a lot, but it's enough that you might find that you and the person you're talking to wind up interrupting

each other more often by trying to talk at the same time, since you haven't yet noticed that the other person is talking too.

Multiple phones might not ring. If you plug multiple phones into some of these services, there might not be enough power to

make any of the phones ring when you get an incoming call. Solutions: (1) Make sure your phones have electronic ringers (not the

old-school mechanical bell ringers). and/or... (2) Turn the ringers off on all the phones except for one of them (possibly two).

and/or... (3) Use cordless phones, which have their own internal power.

Security. In theory, experienced hacker could listen in on calls over the Internet, just like they can do right now with email. If you've

never been worried about email being unsecure then you probably won't care much about this. In fact, email is a bit more vulnerable,

because once someone gets the data they also have the message, whereas with phone calls once they have the data they'd still have

to figure out how to assemble that data into audio they could listen to. Here's an article about VoIP security.

How do I get my phone number switched to my new service?

First of all, if you don't mind changing phone numbers, do so. It'll be a lot easier and quicker if you accept another number. You

can certainly keep your number if you want but it's a little more involved. I kept my own number so I know what the process is like.

When I moved my existing phone number to Vonage, I had to download a form, sign it, and return it to Vonage (fax or email) saying that

I authorized the transfer. Vonage isn't able to get your phone number from your current phone company unless you do this.

While you're waiting for my phone number to be switched, Vonage sent me the phone box and a temporary phone number. I installed it

to make sure it works, but of course I kept my old service active so I could receive incoming calls while waiting for the transfer to actually

take place.

It took about four weeks for my number to get switched. Vonage sent me an email the day before to let me know it was scheduled to

happen the next day. Vonage took care of canceling my old account with your old phone company.

Can I use DSL line instead of a cable modem?

You could, but it probably wouldn't be worth it. Your DSL service most likely comes with your local phone service, so when you get a new

service you wouldn't be able to cancel your DSL phone service, so you wouldn't save any money. Using a new service with DSL is only a

good deal if you're one of those rare people whose phone service isn't coming over the DSL line.

I hope this article was helpful!

Total for 5 years $600 $1080 $1560 $225 $825

International calls Cheap per-minute rates Free to over 60

countries

$5 to $10/mo. for 500 to 1000

minutes/mo.

Cost for at least 1000 mins/mo. of international calls (estimate):

Total for 1 year $840 $936 $312 $345 $465

Total for 3 years $2520 $2808 $936 $585 $945

Total for 5 years $4200 $4680 $1560 $825 $1425

Other features

Keep existing phone # Free $40 extra Free

Voicemail (accessible from any phone or

web browser),

Caller ID, Call Waiting, 911 dialing

Included

3-way calling (conference call) Yes - Yes

Voicemail to email (audio) Yes - Yes

Voicemail to text Yes - Yes

Call Forwarding Yes - Yes

Ring multiple phones

simultaneously

(e.g., a call to your main number also rings

your cell)

Yes - Yes

Call Screening - - Yes



Sign up at Vonage.com, enter my phone # (512-322-0638),

and get your first three months for just $15/mo..

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