MagicJack promises dirt-cheap phone calls

Scott dunn By Scott Dunn

Making phone calls over the Internet is nothing new, thanks to well-known providers like Skype and Vonage.

But a simple USB device from an upstart, MagicJack, promises to bring voice over Internet Protocol (VoIP) to the masses for as little as $20 USD per year.

What is MagicJack and how does it work?

MagicJack is a $40 appliance that’s about the size of two USB memory sticks. You plug any analog telephone into one end, and insert the other end into the USB port of a computer with broadband access. After waiting about one minute while the device self-installs, you can make free calls to any phone in the United States and Canada (no matter where in the world you are) — there are no per-minute charges. After the first year, you pay $20 annually for these calls. That’s not $20 per month, it’s $20 per year.

MagicJackFigure 1. The MagicJack device (left) is approximately the width of two USB flash drives and takes about 30 seconds to initialize itself each time it’s plugged in.

MagicJack rates for calls to phones outside the U.S. and Canada vary from 2 cents per minute to landlines in the U.K., Germany, and France up to $1.21 per minute to Antarctica, according to a list posted by YMax, MagicJack’s parent company. Service to these countries at these rates will reportedly begin in early 2008. If the international party you are calling also has a MagicJack, the call is free.

Except for a desktop shortcut, MagicJack installs no software on the host computer. The company says this allows the device to work on PCs at Internet cafés that don’t permit the installation of executable files.

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