Is free phone service to good to be true?

December 19, 2008 7:04:16 PM PST
How does free local and domestic long distance phone calls sound to you? A Palo Alto based company known as Ooma says that's exactly what it can deliver. You simply hook Ooma up to your broadband Internet and a phone, and you're good to go.

Colin Johnson is hearing about Ooma for the first time and so is Brian Chinn. The two San Francisco residents both agreed to help 7 On Your Side test the product.

In these tough economic times, Ooma thinks it's on to something.

"The primary belief here at Ooma is people should not be nickled and dimed for every single service. And I think people have become really, really used to paying monthly fees, extra charges," said Ooma Marketing Vice President Tami Bhaumik.

That's the attraction of Ooma. You pay a onetime charge of about $250 up front to purchase the device. After that, your monthly phone bill could be a thing of the past.

"The only difference now is your cost is free. Ooma supports your basic calling features like caller ID, call waiting and voice mail," said Ooma Vice President of Product Management Dennis Peng.

The company estimates the average phone bill is $40 to $100 and predicts Ooma users can recoup their cost in less than a year.

We wanted to see if Ooma lives up to its billing -- first starting with the set up. Ooma says average set up time is 20 minutes. Under the glare of the television lights, it took our testers twice as long.

Both called customer service for assistance, both found that helpful and both described the set up process as straight forward.

"I thought the customer service was good. The individual I spoke to was very willing to stay on the phone and talk me through," said Johnson.

We checked back with Colin and Brian several weeks later to get their thoughts. They both liked being able to access their messages on line for free.

"It's very simple. You just go, in sign in. All the messages show up here. You press the button and it just plays the message. It's pretty slick the way they do it," said Chinn.

But Colin had some minor issues with the voice quality.

"The voice quality is not as clear as a landline. It's a little bit muffled and a little bit fuzzy on the edges," said Johnson.

For Colin, the math just doesn't add up. Right now he pays the minimum, $14 monthly for his land line service, and he has unlimited minutes on his cell phone.

He'll stick with what he has. But Brian thinks Ooma is the way to go.

"I'm going to keep it, I liked it a lot. I was able to try it out for a couple of weeks. It works great. I think it's well worth the money," said Chinn.

Ooma can be connected to up to two phones. But each additional phone after that will cost about $65 to set up. You can get a new phone number for free or keep your existing home phone number for $40.

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