Ooma VoIP Phone with No Monthly Fees: Your Thoughts?
As I just mentioned in the post below, I bought an Ooma Hub/Scout system which advertises Unlimited Home VoIP Phone Service with no future monthly fees. Features included free domestic long distance, 911 service, caller ID, voicemail, and call waiting. It was a bit of an impulse purchase, as I can still return it later but who knows how long the 20% cashback will last.
One major concern of Ooma is that it seems like just a matter of time before the FCC shuts it down. I have done some reading on the technical background of Ooma, but not enough to really write intelligently about how their business model can last long-term. I’m basically betting it’ll be around long enough so that I’ll at least break even. (Upfront cost/monthly savings = # of months to break even, often less than 10 months for those with landlines or Vonage.)
After reading a few reviews, there seems to be no real voice-quality difference between Ooma “Classic” and Ooma Telo, the primary difference being a sleeker design and some added multi-handset functionality. However, the new Ooma Telo is subject to a “regulatory recovery fee” of $12 per year after the first year. Not huge, but still not “100% free”. Ooma “Classics” are exempt from this fee per the Ooma Blog:
New or Unactivated Ooma Hub/Scout Combinations
a. No changes to your promised feature set, includes voicemail and a 60 day Premier Trial.
b. If you want to purchase an annual Ooma Premier subscription, you can do so until 12/31/09 at $99.99, after that the price will go up by $20 to $119.99
c. No regulatory recovery fee will be charged
I really like the idea of not having any recurring phone bills, and I might even get fax to work on it. I hope to get it soon and provide a more detailed review.
What are your thoughts? What’s keeping you from buying this?
If you have an Ooma already, what do you think of it?
December 7th, 2009 at 6:11 am
I’ve been using since September last year and it’s working great for me. It has well paid for itself. The voice quality is great. I can even use it to send faxes out.
December 7th, 2009 at 6:45 am
I am an early adopter of Ooma and have had one since early 2008. I love the service, it has already paid for itself and the voice quality is great with no problems 99% of the time. My only concern initially was the business model with no recurring income after initial purchase (for Ooma). I was also, after all, a Sunrocket customer prior to Ooma
. I was glad to see some of the changes like Premier service and the new Telo product line. Its also nice that people who aren’t interested in all the bells and whistles can still get free local/long distance calls with no fees.
December 7th, 2009 at 6:54 am
Had it for almost a year now and saved alot of money doing so.
Quality is great. haven’t heard the threat of FCC may shutting it down. Would be awful if that did happen.
December 7th, 2009 at 7:29 am
Its international rates kill the deal for me. As a guy whose wife is calling China for more than 1000 minutes per month, I prefer to have a “free” (or unlimited) way calling China. Ooma does not do that while a bunch of other VoIP providers do offer such plans.
December 7th, 2009 at 8:00 am
I’ve had Ooma for a little over a year now, purchased on a Black Friday special, having switched from Vonage’s 500 minute per month plan and have already “broken even”. In terms of making money, I’m guessing it has to do with getting people to sign up for the Ooma Premier service and the phone number porting charge (which is “free” when you sign up for Premier). I don’t think Ooma makes that much money from international calls as the rates are pretty cheap and Ooma probably has to pay someone to connect internationally.
They’ve moved the call forwarding feature to a Premier, which was nice to have as an included feature on Vonage. Other features that might make Premier compelling is call blocking and the second line.
As for getting shut down, it’s my understanding that Ooma will no longer be making the Ooma classic, so the new subscribers will be subject to the annual regulatory fee. At least these taxes are still far less than what a traditional land line or cell phone plan would be.
December 7th, 2009 at 8:57 am
I’ve had it since August and has been fine . . . I replaced my Vonage line and have not noticed any difference in quality. I am able to FAX, just have to dial *99 prior to FAXing — works like a charm
December 7th, 2009 at 8:58 am
Bryan,
Are you able to receive incoming faxes?
December 7th, 2009 at 8:59 am
I saw two different listings on amazon, one for $199 called “Ooma Telo” and one for 214 called “Ooma core VOIP.” Can someone quickly tell me what the difference is? Thanks!
December 7th, 2009 at 9:51 am
been using it for 8 months now and love it. no issues at all – seems to work better than my previous 5 years with vonage (i’d have to reset the vonage box once a month or so).
i haven’t heard about the fcc thing either – any info you can pass would be appreciated.
costco is even selling it and they are usually very good about only providing quality products
December 7th, 2009 at 10:24 am
I’ve done a lot of research on this. Their basic model is not sustainable, but their premium services seem good. I believe a small monthly fee (~$1 or $2 / month?) is a more sustainable model. I make very few calls, so vitelity.com or voip.ms is only a few dollars a month for service (I also pay for e911 service), and I like their business models better.
I feel that ooma will switch to a premium-only subscription service as the hype dies down and they have less money flowing in. That, or they will have to start charging a small monthly fee.
December 7th, 2009 at 10:33 am
We’ve been using it for almost a year now. The call quality is almost indistinguishable from our previous landline service.
The forums are filled with knowledgeable people – I setup our Ooma to play nicely with the QoS of our router.
Customer service can be a little dicey, but when you finally do reach them a real person answers. Also, if you’re porting your number over, I’d read posts to see how people with different situations handled it.
December 7th, 2009 at 10:39 am
I’ve been using Ooma since mid-year. As a former Vonage customer, I can say that Ooma’s quality is dramatically better. People I spoke to over Vonage often commented on the poor sound and I suffered frequent dropouts, whereas I have none of that with Ooma.
I am paying for Premier service and have three phone numbers, so I’m subject to recurring charges totaling $160/year. That’s hardly free, but it’s a fraction of what it would cost to have three lines from AT&T, not even considering the cost of long distance. (I have a hub and two scouts, so each number rings on different phones.)
I love the “multiring” feature where I can have my Ooma number simultaneously ring my cell phone. I never give people my cell phone number anymore. They can call my Ooma number, and if I’m home I’ll pick it up there, if not I can pick it up on my cell phone. This saves me on cell phone bills.
The one downside is faxing, which is slow and unreliable. I receive my faxes via a free account at K7.net, so that’s not an issue. I try to send faxes as little as possible. If I had to do it a lot, I would probably pay for an online fax service.
December 7th, 2009 at 11:43 am
I have had the Telo for about 1 1/2 months. A few points:
1 – Overseas customer service is awful. However, the company is very responsive over Twitter/email, and their USA based service (Tier 3) is superb and extremely personal.
2 – One big reason we bought it is future integration of the Telo handset with Google Voice.
3 – The company depends on breaking even the same way Google Voice does, through what they charge other companies to carry a call.
December 7th, 2009 at 11:51 am
Using it since August. Previously used packet8 and before that sunrocket.
quality is equal to or better than either of those.
so far the only problem is when i call out, the receiving person’s caller id shows my last name with the wrong first name — its not even close! pretty tired of calling and emailing customer service to correct it so maybe i will just keep it and be disguised………
havent tried faxing out and i use k7 to receive.
December 7th, 2009 at 1:15 pm
I actually never even tried to receive faxes. I have a free eFax number (www. eFax.com). You can get a free eFax number which gets delivered directly to your e-mail (you don’t get to choose the area code for the free eFax number – - I don’t remember how much they charge if you want a number in your area code).
I love the eFax as I don’t have to ever have to wait near a fax at work or worry if I missed a fax. I just program it into my fax machine in the header so if someone faxes back to me, it goes to my eFax
December 7th, 2009 at 1:16 pm
Many of the features of Ooma can be had through other providers. For example, Google Voice provides the multi-ring feature for free and even gives you a free number to add to your inventory.
I agree that the sustainability of this business model is questionable and that keeps me away from making an upfront investment. Now if you are comparing this to offerings like those from ViaTalk ($200 for 2 years), then you can probably say Ooma is the clear choice. However, if you are comparing this to smaller shops with monthly plans, such as Future-Nine ($7 per month), then the calculations involved in comparing services and likelihood of change in services become difficult.
I have been burned before by VOIP providers changing service plans and terms and totally spoiling the deal. Canceling service and porting the number away from them was a huge hassle. Buyer beware is all I have to say.
December 7th, 2009 at 2:03 pm
I like the point about Google Voice. They give free long distance effectively to anyone with local landline service. Ooma seems to be “eating” the $12/year for early adopters who buy their initial system, hopefully that lasts given they seem to be growing in popularity.
December 7th, 2009 at 2:14 pm
I’ve had Ooma since September 2008. In that time, it’s been great for us. There was one outage of appreciable length (several hours – in April of this year) and maybe one short outage of 15-30 minutes (a few weeks after the first). Other than that, it’s been up and functioning perfectly. I’ve referred two of my co-workers (one of whom successfully uses the Ooma for incoming and outgoing faxes) and we’re all very happy with the service (and the price!).
Prior to Ooma, we had only cell phones. We got the Ooma because we were bumping up against our monthly minute allotment and used up all our rollover minutes. I figured if the company stayed in business for a year after I purchased, we’d break even (purchased hardware for $240, next level of cell service was $20 extra/month). It’s been an excellent investment for us – we’re so happy we went to prepaid cell phone service earlier this year, saving us approximately $50/month over the old cell phone bill.
December 7th, 2009 at 5:55 pm
I have had an OOMA for a year, and I have had zero problems. I have even used the international rates for South America instead of those unreliable calling cards because it is just so convenient.
As silly as it sounds, I feel better with a “landline” phone in reach if something were to happen.
I have converted three other people to OOMA, and haven’t heard anything bad.
December 8th, 2009 at 11:56 am
i just took a quick peek at the 1 star reviews on amazon and there were many complaints on customer service, and someone even mentioned there being a 3000 minute limit.
December 8th, 2009 at 12:13 pm
These reviews were on amazon regarding fax capability:
Hello G., ooma doesn’t guarantee that fax will work reliably 100% of the time, however generally it does work. If you want to learn more, try searching for article #261431 on the ooma support site: http://www.ooma.com/support
S. Malone says:
I am able to send and receive faxes with no problems. You have to dial *99 before sending. I think this switches the hub to analog mode. You do nothing different for receiving. I have never tried it, but they (ooma) says that it only works from the hub (scout can not fax).
December 8th, 2009 at 1:46 pm
Are we worried that Ooma will die, like sunrocket, and customers that paid for the hardware will be left holding the bag? I only had about 3 months of Sunrocket before it went away, and never had any luck getting a refund on my $199/2yr plan.
December 8th, 2009 at 7:13 pm
3000 minutes is the VoIP definition of “unlimited” outbound calling. This seems to be prevalent in the industry. Toll-free calls sometimes don’t consume this unlimited limit. Inbound calls are usually unlimited for most providers.
I heard somewhere that Ooma was being sold a Costco and some interpret this as a vote of confidence in the company’s future. I don’t.
I found Future-Nine and I like it. Great support, excellent uptime, pretty god features, cheap price… Do I sound like a shill, I hope not, I am just happy and I have tried a few others.
By the way, I use sipgate’s “one” service as a backup. They give you a phone number for free from their pool. Outbound calls will cost you though. But hey, include the opportunity cost of the interest on the $200 for Ooma and you might find that sipgate.com has them beat depending on your usage.
December 9th, 2009 at 9:19 am
Christian: Google Voice’s multiring and free long distance are only useful if you already have a phone line. The nice thing about Ooma is that it gives you two phone lines at a fraction of what you’d pay a regular phone or cable company.
Christine: All residential unlimited calling plans have nominal limits. That allows the provider to make sure that phones are really being used for residential, not business, use. According to Ooma’s blog, they have never shut down a legitimate residential customer regardless of usage.
Robert: It’s certainly possible Ooma could go under, rendering the hardware worthless. However, I doubt that’ll happen soon. They’ve raised four rounds of venture funding, the most recent being $18.3M in June. If I can just get a couple of years out of them, it’ll still be a huge savings over using AT&T.
December 9th, 2009 at 9:55 am
Jim: I am aware of how Google Voice requires a line. I use it heavily. Sorry I wasn’t more explicit about it.
I am just saying that you can create your own multi-featured VOIP service by getting a cheap VOIP solution and pairing it with a free Google Voice account. It is worth considering.
December 9th, 2009 at 5:58 pm
We’ve used ooma for six months and haven’t had any real issues to date. 3 more months and it will pay for itself. I was paying $25/month with my old service (Mediacom cable).
Check to see if ooma can port your number or find out if they have other local numbers available before you order one.
December 21st, 2009 at 8:24 pm
Have had Ooma for 18 months with no complaints. Had it as a 3rd line behind two Cincinnati Bell landlines. I got tired of the $100 phone bill every month so we bagged one of the lines and reduced the remaining bell line to a bare bones dialtone only line (18 a month).
April 1st, 2010 at 12:22 pm
Got my Ooma hub from Costco about 2 months ago. Very happy. Had the Comcast VOIP phone (using combined cable modem & VOIP box) and ooma played fine with it. Decided not to go premier so paid the $40 phone number port fee. Once my existing phone number was ported I swapped my Comcast combined modem for a plain cable modem. Saved $5/mo rent on the modem plus the monthly phone cost of Comcast. My payback will be about 4 months & then free phone (other than the $11 year)!!! Wish I had done it sooner!!!