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Internet phone service Ooma promises big saving for consumers

April 11, 2011 12:00:00 AM PDT
Tired of paying big bucks for phone service? There are a number of options that can eliminate a monthly bill from the phone company.

Since Carl Ellyn switched his family's phone service, he saves more than $700 a year on his phone bill.

"The cost savings, you can't beat. The call quality is better than what we were getting on any of the other services," he said.

Ellyn and his family make domestic calls free through the Internet using a device called Ooma. This oddly named device is a top-rated phone service in Consumer Reports' latest survey of phone services. It also got high ratings for value, despite having to pay at least $200 for the hardware.

"It's a little bit pricey, but you don't need a computer like you do with some other, alternative phone services," said Consumer Reports' Paul Reynolds.

Along with the free unlimited domestic calls and cheap international rates, you get call waiting and caller ID. But you still do have to pay some taxes and government fees, totaling around $3.50 a month.

When Consumer Reports tester Bernie Deitrick checked out Ooma, he had it up and running in less than 15 minutes, including the time it took to register online and connect it to the Internet.

"In Consumer Reports' survey, Ooma's reliability and voice quality compared well with most cable company phone services. Its rivals, Skype and magicJack, both scored below par on those two measures," said Reynolds.

Ooma works with your existing phone or you can buy an Ooma handset for $50. But be aware, if you want to use the same phone number you have now, there's an extra $40 charge.

All in all, the Ellyn family finds Ooma to be quite a bargain, despite the fairly steep investment in hardware to get it dialed in.

If your phone service is currently bundled with your Internet and television service, you should check with your provider before dropping it to see what the bill will be. Consumer Reports says your provider may increase what you're paying for the remaining two services, limiting the savings you can expect.

Still, Consumer Reports says people were so satisfied with Ooma that it's an Internet phone service worth considering.