VOIP Overview
With the popularity of internet Voice Over IP providers such as Skype, verbs such as “Skyping” have entered the lexicon of the average person. So it’s no surprise then that the number of US VOIP subsribers have nearly doubled according to recent statistics. With continuous pressure for innovation, many VOIP providers have come up wideband codecs that make VOIP calls superior to traditional fixed line calls..
Why is VOIP so Popular?
There are a number of reasons why VOIP may be gaining in popularity and I think that primary reason is the fixed price model. For most VOIP providers there is either a fixed monthly rate for an “unlimited” calling pattern (though quite a few providers do have a soft cap limit, which if searched for carefully in the TOS one can usually find) or a pay per call model, such as that adopted by many Australian VOIP providers. Either model though offers a considerable amount of savings when compared with the incumbent Telco of the respective VOIP provider’s home country.
Another reason that VOIP providers have been gaining in popularity is a phenomenon that I’ve dubbed “place shifting”. This is basically the fact that many people leave their home towns, home states or even home countries to relocate to areas that offer them better opportunities. Unfortunately this means that they usually have to give up their traditional land line number and thus the “local calling” rates that their friends and family once enjoyed. With any VOIP provider, numbers are ultra-portable and thus you can use your service wherever in the world you happen to be. Going on vacation in Switzerland? No problem, your family in New York can still call you as if you were next door. This is what I find truly amazing about VOIP.
The final reason is the sheer innovative features that VOIP have developed. Time based call screening is one of my personal favorites, imagine being able to simply program your phone not to ring between the hours of 10pm, and 5 am unless it’s an emergency (and the person has to press a button for the call to go through)!
The Magicjack
I must admit that this latest internet “craze” caught me head on and I find myself spending hours on the internet and forums searching for the latest VOIP gadget. I’ve seen many such gadgets come and go, but one that particularly caught my attention was the Magicjack VOIP device. I first read of this device over at dslreports where a few people had been using it for a number of months. The thing that caught my attention was the fact that this device provided unlimited US/Canada calling for $40 US for the first year and then $20 US for all subsequent years. Now if you’ve ever used traditional VOIP providers like Vonage or a Cable VOIP provider then you know the average price for VOIP is probably $20-$30 US per month.
Cost Efficiencies
Now most people probably don’t care about the finances of a particular company, or it’s founder but in the world of VOIP this is something that everyone should pay close attention to. With the recent bankruptcy of start-up VOIP provider Sunrocket making sure that your future VOIP provider isn’t some fly-by-night operation is really important. So how can Mr. Borislow afford to give away unlimited long distance calling in Canada and the US for a fraction of what larger companies are offering?
Take a look at this screenshot from Magicjack’s user interface:
(and no this isn’t a screen shot from my unit)
Targeted Local Advertising
You can clearly see that 1/3 of the interface on the left is reserved for advertising space. If Mr. Borislow woos advertisers correctly he can make a healthy profit by displaying local ads based on the numbers that call you and vice versa. This would be a revolution in online local ad targeting as I haven’t seen any other online platform that can do this well. According to Mr. Borislow over at dslreports:
” In March we will let you use your own devices and we will sell Phone numbers for just $3 a Year. “
This is excellent news, if it is indeed true. With ATA support Magicjack users will finally be freed from the chains of a computer and the whims of their OS.
Owing a CLEC
If you take a look at the parent company of Magicjack, Ymax Corp. you can see that they have some serious financial backing. It also means that Magicjack has a chance to make money on incoming calls since they are in effect their own upstream provider. Other VOIP providers basically resell the services or other larger back bone providers such as Level 3. These providers make money when they receive calls because some other company has to pay to terminate calls on their network. By owning your own network you can also cut costs because the termination of calls is on your network. Though I have no idea how extensive Ymax’s network is, I’m betting it’s pretty big and they terminate most of the calls in house to save the maximum amount of money.
No Vulture-Capitalists
Venture capitalists make technology possible, unfortunately their lack of forsight and motiviation to make a quick buck also have disastrous consequences in the VOIP world. As far as I’ve been able to gather Magicjack is privately funded and thus does not have to answer to any venture capitalists. This gives them a chance to develop their customer base more gradually and not shell out a huge amount of money acquiring new customers simply to make their investors happy.
Overall I believe that the initial $30 investment (plus shipping of course) is a mere pittance for the services rendered. Even if the entire company goes bankrupt overnight you have very little to lose by purchasing a Magicjack unit, and potentially a lot to gain if this thing get even more popular.
Tune in for Part 2 of this review where I detail the set-up of this device as well as discuss call quality and areas where I think Magicjack could improve.
19 Comments, Comment or Ping
Dan Hunt
I received one as a Xmas gift and have been very disappointed. Only works about 10% of the time. Absolutely no customer support. Their Terms of Service and Software License Agreement says it all - http://www.magicjack.com/site/tos.html. Pay particular attention to item 16 titled “No Warranties”.
Jan 4th, 2008
admin
Dan, what sort of problems have you been having? What ISP are you with?
Jan 4th, 2008
Jack
Sorry to her that Dan. I’ve been using mine for a while now and out of the 100s of calls I’ve made, I know of only twice that the call did not go through properly. Which was most likely due to my internet lagging out for a moment or two (These things do happen from time to time).
I’d say you should really look into checking the service from your ISP. So far I’ve had no problems at all.
I currently live in Maryland.. I travel a LOT, and so far I’ve used it in Cali, NY, FL, UTAH, etc etc. It even worked fine when I was in Canada. I call to and from all over the US and Canada with the same results.
As I said before, you’re probably getting bad results simply due to your internet connection.
Jan 8th, 2008
Jonathan
I bought a majicjack about a week ago and I love it. I feel the same as Jack. Sound quality has been great. No dropped calls. Easy set-up. All the features of call waiting, forward, voicemail, and 411 are great. I am using cable right now, but I am switching to DSL, so I will have to how well it works with that.
Feb 14th, 2008
Daniel
I read similar article also named , and it was completely different. Personally, I agree with you more, because this article makes a little bit more sense for me
May 26th, 2008
steve
The magicjack sucks got it all set up and theres no area code close to me so we picked on 100miles away got a dial tone made a call and guess what the people that we called could not hear us, so we tried again and again we could hear them but they could not hear us.
My wife chated with a rep she said we will have a area code in a week or two been 3 weeks and now we can’t get trough to anyone. The Magicjack is a big RIP OFF no wonder that
dan borislow is soo rich he’s coning people We got coned out of our money.
If any one knows Dan Borislow tell him to call me I want to get in on his little game I need the money.
Alot of people mainly the poorer people try this junk to save some money but people like Dan rip us off way to go Dan just like the gas and oil co get rich at the cost of the poor
May 31st, 2008
Donald
Yeah! I have had the unit for about two months and have had repeated down times with the softphone. On startup, get “error message, must close program” notices and icon closes. when contacting live support have gotten a lot of run-around. Past from tech to tech without solving anything. Each tech requires rehash of all the step you have taken and and all of the issues. It is simply “peat and repeat” over and over again. Tonight, 6-1-08, I had four techs. One twice! and each time “how may I help you?” There is no solution provided by the company. There is no eamil, telephone, address—NO INFORMATION TO CONTACT THE COMPANY ABOUT THEIR POOR QUALITY OF SUPPORT!!!!!!!!!!!!!!
BOY, THE OLE ADDAGE THAT STATES “THE BITTERNESS OF POOR QUALITY FAR OUTLAST THE SWEETNESS OF LOW PRICE” SEEMS MORE THAN TRUE WITH THIS OUTFIT.
Jun 2nd, 2008
steve
I see you can’t face the facts about magicjack when I leave a comment you wipe it out so no one can see it thats just like the rich people your only think about how much you can con people out of
Jun 4th, 2008
admin
Steve,
I haven’t been wiping out comments, it’s just that there’s been a lot of spam lately and I’ve been slow to go through it all.
Jun 7th, 2008
Ron
I have had the MagicJack for almost a month now and I have had no problems with it.
It is definitely more clear than my cell phone and people can hear me clearly.
I recently spoke to a person on youtube who had the same problem with his MagicJack regarding the error message and then it closing. To best insure that the issue is not the MagicJack I suggest to those individuals to try plugging the MagicJack in an alternate computer to see if the same problem arises. If it hooks up fine then the issue has to be the computer (or OS) and not the Jack. If the problem does occur, then it may be the Jack.
As of now, I have hooked my MagicJack up to 4 different computers and it has worked fun on all 4 (2 laptops and 2 desktops).
Whether there is a future for this gadget, I cannot say, but I know that as of now, it works wonderfully and I hope that it continues to stay in service.
Regards,
….Ron
Jun 12th, 2008
Lapora
i am using MJ in canada and when i go Vacation To Sri Lanka It did not @ the very first attempt,
Tec support did not work, i can log in, their is dial tone, but no in/out calls So i strongly told them (@ least 2 Rep’s)that may be MJ blocking certain country Ip’s and After 2 weeks It worked Totally Fine
YES IT DID WORK , THIS IS PORTABLE VOIP
i am More Than Satisfied the Quality is same as Here in Canada
Jun 21st, 2008
michael glick
mr dan borislow,i cant find any help any where as to how to contact customer service,i ordered your product on jun,28th08 5;17am and ordered one to try also paid xtra for the shipping and paid the xtra 19.95 for the xtra year ,never receaved a confirmation number for my purchase on my master card,still havent received my item that i purchased from ur company have no number to talk to live person from customer service and im checking wiyh bank today to see if the moneys been taken out ,i really need to speak with someone about my order either im getting or if a mistake was made i understand things sometimes happen but if i could at least hear from somebody ,now im reading bad responces from people about the product ,but would like to give it a chance first but need the item first .ph#423-718–5334 ,email,michael_glck@yahoo.com,name michael glick 427 suiteb main street cedartown ga 30125 heres all my order information need to hear from somebody asap please.respectfuly michael glick
Jul 11th, 2008
debbie
I have had my magicjack since 4/13/08, and I have had a lot of ups and downs.at first they did not have my area code,so when they got it I had my number changed.wrong thing to do ,now I can call out as the new number but when someone calls me they have to dial the old one(which i might add is still long distance for them).I have spent the better part of the last week on the internet with their techs? for hours at a time and it has not helped at all. They try to tell me it the usb ports on the computer.well I have used different computers, different phone and updated dozens of times and it is all the same.Does anyone have a phone number or email for the owner?
Jul 17th, 2008
Oscar
I had the Magic Jack for about 2 months, and no problems yet. I have tried it on 10 diffrent computers showing friends about the MJ, and they like the product. The only down side will be the customer service. But when it comes to the MJ itself it’s great !! I read the comments that they dislike the product, and I belive that some people don’t have a good internet connection, I currently use cable. For $19.99 a year you can’t beat it.
Jul 28th, 2008
Tim Orque
Magic Jack said they will not charge my credit card withing the 30 trial days.. and they made promises.. As soon as I receive the package.. 2 days after my credit card charged.. they lied! The system don’t work and I am really pissed off.. I will contact the FBI soon and we need to get to the bottom of this.. no return address or telephone I could contact regarding this matter .. please help me.. give me these information I need.
Much appreciated.
tim
858-3973914 C:
Aug 8th, 2008
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