Slash your phone bill down to nothing

March 1, 2010 7:58:50 PM PST
It is possible to slash your home phone bill to as little as nothing. Here with several ways you might be able to do just that.

How does a monthly phone bill of just $3 a month sound? Or maybe no monthly home phone bill at all? There are a few different options that might work in your home.

Andrew Ma of Portola Valley says talk really is cheap.

"Who doesn't want to save $350 a year? It's so easy to use. You cannot tell the difference," says Ma.

Brian Chinn of San Francisco says one device could get his monthly home phone bill down to zero.

"I think if you use a lot of long distance, it works out really well," says Chinn.

And Tom Merritt of CNET thinks the cheapest alternative is at his fingertips.

"In the long run, if you keep it for a few years, it's cheaper than the other services," says Merritt.

All three make phone calls that go over the Internet. Ma saves money with a little device called the Magic Jack.

"You plug it into your USB, install software. You're ready to go in less than 15 minutes," says Ma.

Magic jack costs $20 to purchase plus a $20 annual service charge for local and long distance calls to the United States, Canada and Puerto Rico. You will have to pay additional charges for international calls to other countries. The executive editor at CNET says there is a downside.

"The Magic Jack has come under a lot of criticism for the customer support when things go wrong," says Merritt.

7 On Your Side first met Chinn a year ago when he agreed to give Ooma a test run for 7 On Your Side. He liked it so much, he kept it. We recently caught up with Chinn.

"I like it. It was nice. Sometimes it was a little slow to connect, but then once it connected, I didn't think there was any problem with the voice quality at all," says Chinn.

Ooma retails for $250, and like Magic Jack, domestic calls are free. The company estimates users will make up that cost in less than two years by eliminating the monthly phone bill. Brian tried Ooma for 10 months, but said he reluctantly gave up the service because callers had trouble hearing his wife.

"It's a good thing. It just didn't work for us," says Chinn.

A popular alternative for home phone users is Skype.

Merritt hooks up the Skype application to his iPhone, but others convert their less expensive iTouch into an iPhone by hooking the iTouch to the Skype ap. A subscription is $2.95 a month for unlimited calls to the U.S. and Canada. It can be used wherever you can get a Wi-Fi connection.

"Skype makes more sense replacing a landline in your house, although it can also replace your cell phone. It just reduces your coverage area quite a bit," says Merritt.

Merritt has tried and reviewed all three services we've talked about. He thinks Magic Jack would save you the most money, but that is not his top pick.

"I'd probably choose Ooma, yeah," says Merritt. "The savings is going to pay for the device and the peace of mind you got for having a little customer support, I think is worth it."