Clark Howard: Cut your phone bill with a one-time payment

Consumer expert Clark Howard’s column appears here each Thursday in conjunction with Deal Spotter, a weekly print section in The Atlanta Journal-Constitution.

ClarkHowardThere’s a phone service I’ve been using for years called Ooma.com. You pay as little as $100 to $220 to buy the device, which provides phone service for the life of the Ooma service.

Ooma requires that you have high-speed Internet to use it. Once you buy the unit, you bring your existing number over from your local monopoly phone company and that’s it. You get local calling, long-distance calling, voicemail and caller ID from Ooma. No more monopoly phone company bill!

So you just pay once to buy the unit and you’re done — with an asterisk. There are regulatory junk fee pass-through charges that are billed annually at a cost of $11 or $12.
But Ooma recently sent out a notice about a change in its terms of service to say the pass-throughs will now be around $38 annually.

The new changes in terms of service mean you’ll now be paying $3 and change per month in junk fees for free home phone service for the life of Ooma.

I hate that they’ve raised the fees, but this is still a real value proposition. If you were to buy an equivalent package of calling services from your local phone company, it would probably be $40 or $50 a month.

Again, I have to stress this is “for the life of Ooma.” If you go and buy a unit and Ooma quickly goes bust, you’re out the money for the unit. You’ll never get that money back. But I’ve had Ooma for years and have saved for years.

The ultimate test is my wife, who has not let me disconnect our monopoly landline at home for whatever reason. The funny thing is given the choice of the landline and the Ooma, she always uses the Ooma because the calls are so much clearer than traditional landline calls.

-by Clark Howard, Save More, Spend Less, Avoid Rip-offs

“Clark Howard’s Living Large in Lean Times” is Clark’s new book, in stores Aug. 2. Visit ClarkHoward.com for info about pre-ordering.

30 comments Add your comment

tim

July 7th, 2011
7:38 am

Gee Howard……your wifey hasn’t let you disconnect your landline. What a wimp….for many reasons. At least this time you didn’t call it cute or fancy……

NoMoreCornSubsidies!

July 7th, 2011
7:40 am

I’ve only had my Ooma Telo for 3 or 4 months now, but I’m already kicking myself for not getting it sooner! Calling family across the US is free and I call my friends in Europe and it’s cheaper than Skype! I wouldn’t say it’s right for everybody, and make sure you hook it up right (the Ooma box plugs in to your broadband modem before your wireless router).

People using Vonage or MagicJack are getting shafted, paying for sub-par service and national advertising. Tell them where to shove it and switch to Ooma.

Eric

July 7th, 2011
8:04 am

It’s all still much to expensive! I’m soon going to drop my cell phone plan and return to the landline (cheaper and less complicated technology). Never thought I’d want to return to the 1990s, but I do now.

denden

July 7th, 2011
9:40 am

and what does Clark do when the power goes off or his computer craps out?

Kate

July 7th, 2011
9:46 am

Former Bell phone companies haven’t had a local monopoly since the laws were changed in 1996.

And they have nothing of the kind now, as ironically this article itself makes clear. There’s many ways to get phone service.

Ooma sounds like a good product, but like any VoIP service, it only works as well as your electricity and your internet service. Internet down? No phone. Power out? No phone. That includes 911 service. To avoid that scenario, I’ll be keeping a cheap $18/month landline as long as they continue to exist. Once you’ve had several neighbors knocking on your door asking to use your landline in a power outage, it kind of changes your perspective about how “advanced” the new options actually are.

Dub

July 7th, 2011
9:47 am

And what does Clark do if he has a security system or needs 911?

SuwaneeMommy

July 7th, 2011
9:55 am

Dub, Ooma has 911 covered. You register your street address with Ooma, and it is transmitted to 911 when you call 911. Of course, if your Ooma is down because your Internet connection is lost, that is a moot point.

We like Ooma, so far. I’ve had a few issues with call quality, but nothing out of the ordinary, since we’ve switched from T-Mobile at Home VOIP to Ooma.

We got our box at Costco and it was slightly less than the list price.

KJ

July 7th, 2011
10:01 am

“and what does Clark do when the power goes off or his computer craps out?”

I’m guessing Clark uses his cell phone, which Clark can also use to call 911. Are you people really that worried about needing 911 when the power goes out? Do you also wear a helmet when you walk outside?

David Letterman

July 7th, 2011
10:03 am

Oprah, Ooma. Ooma, Oprah.

Dali

July 7th, 2011
10:10 am

NetTalk device is awesome and costs only $29.95 for a year of service. The point of entry is much lower at $40 for the one time purchase of the device. Thus, for $69.95 you get a $40 device and a year of service at $29.95. Renewals are then a flat $29.95 a year afterwards, thus a better proposition value.

Pacer girl

July 7th, 2011
10:17 am

I have a pacemaker device. I also have a home monitoring unit. The device can only use land lines to transmit. This can mean my life. Also the “phone” lines that go over the internet are not 911 compatible nor do they bounce off cell towers to find your location like a cell phone. So this may cause trouble when a person calls 911. These lines may save you money but cost a life if there is problems. Funny how you never metion that when you are talking about phone plans.

RO

July 7th, 2011
10:19 am

Everyone in this town seems to love Clark Howard. This is the first article I’ve read from him. Ooma? what a waste of money. Get in the 21st Century, Clark. Who needs a landline anymore? What a waste of money. Furthermore, Clark is suggesting an internet-based landline, then why doesn’t he suggest the FREE google voice thing instead of something OOMa at a couple hundred dollars plue $40 maintenance per year.

RaleighDawg

July 7th, 2011
10:27 am

I don’t know how OOMa compares, but I have a magicjack that cost me initially $40, plus $40 every year to renew. Sounds like the the same thing and around the same cost. However, my magicjack does NOT support faxing, nor does it work with my alarm company. I keep it to reduce my long distance expenses, but I still have to keep my land line for my alarm and for faxing.

RaleighDawg

July 7th, 2011
10:29 am

Oh….and I occassionally run into problems with my magicjack calling “non toll free” conference call call-in numbers and I revert to my cell phone in those situations.

Mel

July 7th, 2011
10:49 am

Buy one from Costco (or costco.com…doesn’t matter)!! We got ours two years ago after AT&T discontinued their CallVantage service and have loved Ooma! About 4 months after the year warranty on our Telo ran out, it bricked itself without warning and stopped working. We called Ooma support and they verified the unit was dead and said there was nothing they could do to replace it because it was out of warranty. Then I said the magic words, “I understand that, but we bought ours from Costco.” Immediately, their tune changed. They told us how we could return the unit to any Costco store and when we got the new device, all we needed to do was call back and they’d transfer our service to the new device. When we returned the Telo to our local Costco store, they gave us full price back for what we paid for the unit, including tax and we turned right around and bought a new one right there at the store. And even better, the price had come down so we ended up paying less for the new Telo than we did for the old one. If not for Costco’s awesome customer service and return policy, we’d still be searching for a VoIP provider because we refuse to be tied to a $50+/mo landline ever again!! (And we tried Magic Jack and the call quality is awful.)

Intown Resident

July 7th, 2011
10:59 am

We’ve had Ooma for a long time and love it! Also LOVE KittyWireless.com for connecting to PagePlus for cell phone service – coverage is equal to Verizon with NO long term contract – buy your phones from Ebay or Kitty Wireless for very little money – buy an $80 – 4cents a minute card from Kitty – and just buy additional cards from them as needed. We use our cells for talking and texting – not for data – and using Kitty/PagePlus instead of Verizon has saved us a ton!

Ooma Premier User

July 7th, 2011
11:22 am

I use Ooma Premier which costs an additional $100 a year. Premier can allow you to ring your cell phone simultaneously anytime you receive a call to your home phone. Also, Ooma will route calls to your cell phone should your high speed Internet suffer an outage or should your power be down. It does this automatically by checking a box online with your Ooma account.

You can also block telemarketers easily by blacklisting them. There are some other neat features as well.

Ooma isn’t for everyone and others have already noted the main exceptions. You have to put up with some inconveniences in switching and occasionally afterwards, but if you’re interested in reducing your expenses, it’s worth checking out. The voice quality exceeds the monopoly phone company’s residential phone lines. Consumer Reports gave Ooma top marks a couple of months ago.

One other thing: If you have DSL with AT&T, they make it difficult for you to drop your landline by pulling every excuse out of the box. Part of the difficulty lies with their ineptitude about how technology works and about their own internal policies. The quality of AT&T’s customer service people is very uneven and the experience will make you glad you dropped this monopoly-minded company. AT&T essentially guarantees that many people will want no part of their bundled offers by being extremely difficult to do business with.

Brown Eyed Girl!

July 7th, 2011
11:30 am

This service does not provide WiFi.

scooby-doo

July 7th, 2011
12:32 pm

@ beebee – This is America and we have freedom of speech in this country. People have a right to complain, protest, gripe, whine, nitpick and bitch about anything they want without fear of persecution, harassment or discrimination. I do understand your concern because some of those people can be very annoying, irritating, bothersome and aggravating. Furthermore, the articles on this web page touch on a very sensitive subject…saving money, which is something people are struggling to do nowadays, therefore; the passions can run high and the opinions can be low.

Nora

July 7th, 2011
12:53 pm

Addaboy, Clark! I’m ready to try Ooma and save some Moolah! The kill factor for me with MajicJunk was those stupid ads. Thanks for always looking out for our bottom line, buddy!

jarvis

July 7th, 2011
3:52 pm

Isn’t most phone service free now with your high speed internet service?

StanMan

July 7th, 2011
7:00 pm

One thing I haven’t seen anybody mention is what if you actually want your name in the phone book. You know, in case you want people to be able to find you. I recently lost a wallet and that’s what the guy who found it did was look me up in the phone book. I guess you wont be published if you get Ooma, will you?

Raisin Toast Fanatic

July 7th, 2011
9:24 pm

I’ve requested that your anti-Semitic comment be removed.

Please stop the self-assigned policing of the blog. Nobody likes a tattle-tale.

Irishluc

July 9th, 2011
9:33 am

Sounds just like Magic Jack, which I have had for a couple of years now and it works great, when I use it.
No monthly fees and a much lower start up cost.
Haven’t had much problem with internet outages either, am on wi-fi.
Seems if you listen to Clark you spend more money than you should.

jtom

July 9th, 2011
11:34 am

For those of you who want to get rid of your land-line phone but keep AT&Ts DSL:
When I called to disconnect my service and explained I wanted to keep the DSL, they told me I would have to pay an installation charge as though I were a new customer. Then I said these magic words, “Oh, really, well then never mind disconnect the DSL, too. If I have to pay an installation charge, I’ll just switch to Comcast. They have a special introductory discount for a year. Thanks anyway.” (always be nice – you get more). Result: I kept my DSL, no ‘installation fee’ and a one-year service-retention discount.

They pay out about $500 in marketing costs for every new subscriber they get. If necessary, they’ll spend a couple of hundred to keep an existing customer.

I only have a cell phone. No landline, no VOIP phone, no problems.

Police

July 9th, 2011
11:40 am

? I Like a tattle-tale.

george

July 9th, 2011
1:25 pm

magic jack seems a little spotty on call quallity but ihave a couple of neighbors who have it as a backup to their cells. i am not sure where clark has had his head buried in the sand for the last 20+ years with his references to the monopoly carrier. there are none any more. perhaps he was referring to the monopoly electric and gas provider which is the only choice in my area.

tim

July 10th, 2011
3:07 pm

Send smoke signals……it’s free.

Will B.

July 11th, 2011
6:24 pm

magicJack is not good. Don’t buy it because they won’t give you a refund. I’m out of a lot of money for the 6-year period advertised on t.v.

Scott Tobkes

July 13th, 2011
3:45 pm

Love ooma, have it since day 1…I pay for the additional “premier” features.