Ooma now for sale: Is it worth it?
A few months ago, my co-worker Stephen Shankland took a look at a preproduction Ooma--the pay-once-and-you're-done phone service that's going on sale for real today. His experience setting up the Ooma hardware wasn't the best. I just got one of these gizmos myself and checked it out here at the CNET office. I found it to be pretty straightforward to get running, although my setup was much simpler than his. My take: This is a very cool, and very well-priced product. It's also technologically fascinating. It's not just a VOIP box.
I set up my Ooma by plugging it into the Ethernet in my office and to a spare telephone. That was the extent of it. After a few moments of blinking, the Ooma box settled down, and I was able to dial out straightaway. Inbound calls worked perfectly, too, to the number attached to my device. People I talked to said the calls were clear, and I didn't notice any lag on my calls (like you get with cell phones or bad VOIP).
Ooma hardware: Oh so pretty.
(Credit: CNET / Rafe Needleman)Initially the Ooma setup instructions scared me. If you're installing it in your home, some of the connection diagrams are off-putting, especially installations for DSL customers. Ooma also wants to connect to your phone line. In fact, Ooma is being pitched as a great product for long-distance calling, not local calling, although its best payback is when you use it for everything. Ooma expects most users will keep their old phone line active for 911 calls. And it's the users that keep the old lines alive, and just let Ooma handle the long distance, that make the Ooma system work. That's where Ooma gets really interesting.
Here's why: Ooma uses a trick called "distributed termination" to run its system (read more on GigaOm). That means that when you call someone in another area code, the Ooma network routes your call over the Internet to the Ooma device of a user in that other area whose hardware is still connected to the landline. And then that box (the other user's) makes a local phone call out to the person you are trying to reach. Without a network of users connected to the phone network, Ooma's financial model doesn't work, as it has to pay for the calls itself. And this is why the company was so eager to give out Ooma devices to early adopters a while ago: It needed to build its network. CEO Andrew Frame assures me that this pilot program succeeded, and that the Ooma network is now fully operational and financially sound.
The borrow-a-phone-line model worried me for several reasons, but Frame reassured me that the Ooma system is secure and that a variety of contention issues you might think would pop up in this service have been solved. Apparently, through phone hacks I probably couldn't understand (and that he wasn't about to reveal to me, on the off chance I did), the system maintains your call privacy and the other user's line availability even when you're borrowing his or her connection.
Ooma installation: Can be weird.
The Ooma device and service costs $399 until 2008, when it will go up to $599. For the price, you get all the U.S. phone service you can eat (and international calls at reasonable rates), forever or for three years, whichever comes first--apparently, Ooma's accountants won't approve of a lifetime service plan. Other VOIP-ish features include voice mail you can retrieve over the Web, call-waiting, and a "second line" that you can access if you have more than one phone in your home. The second line feature requires that your extensions are connected to $39 Ooma "Scouts," satellite units that transmit Ooma signals over your home's phone wires to your extensions. (If you use one of those multihandset cordless phones, you won't get the full-featured second line on them.)
If you consider the Ooma as a three-year investment, it's $8.33 a month if you cancel your landline and trust the 911 service that Ooma routes you to--it won't know where you are calling from. That's a steal for a phone line, and it's a great solution for a second line or a business phone where 911 isn't necessary. If you keep the landline, it's still very cheap long distance, but depending on your usage patterns, dial-around long-distance services and pure-play VOIP plans like Skype Out might be competitive.
Rafe Needleman writes about start-ups, new technologies, and Web 2.0 products, as editor of CNET's Webware. E-mail Rafe. 
Ooma seems like way too much hassle to save $10/month.
Have starbucks 26x instead of 28x a month and there's your $10 bucks.
Ooma seems like way too much hassle to save $10/month.
Have starbucks 26x instead of 28x a month and there's your $10 bucks.
1. Some other subscriber can listen in on your conversation, in the safety of their own home, using rather simple electronic circuitry. Ooma claims to have a "proprietary solution" to prevent this, but it is technically impossible to detect and prevent eavesdropping of this type.
2. If someone else uses your line to make illegal phone calls (bomb threat, drug deal), the police can trace it back to your phone and you will be in trouble. Ooma says that their phone records will show where the call really came from, which might get you out of trouble, but it won't keep you out of trouble in the first place.
Ooma has not been honest about these problems, and in fact, threatened legal action against a web site I created to detail them.
Mike P.
Could you kindly tell me how you hooked it up w/o a landline? I've been trying for hours & I just get the buttons lit up red because it's looking for a landline.
I think the alleged security issues have been touched on in a number of other internet forums - they're pretty much bogus fears from people who feel that they must defend Skype or Vonage or some other voip product.
The call quality is just a small notch under that of traditional landline connections, if there really is such a thing as a landline connection anymore. I've made several calls and unless I ask the other party if they hear any difference, they don't say anything. The call quality is vastly superior to Skype, which I love, but is very sketchy. I'd categorize the ooma call quality as something like a really really good cell phone connection - no drops, static, echos, latency, or anyother detectable deficiency. It's just a little bit 'thinner' than a traditional call.
Cost-wise, it is a bit deceptive to call this "free". But ooma says on their website that they predict there will be no cost for at least three years. Taken at their word, this works out to $11.11 per month for unlimited prepaid US calling. I only occasionally call overseas, so I can either use Skype for that or use ooma's very low international call rates. The biggest risk is that ooma doesn't survive for three years. For the excellence of call quality I'm receiving under my 60 day trial, I'm taking that risk.
I just about signed up with Vonage a month ago and had given them my credit card info and shipping address under a special "Try us free for TWO months" deal they were having. But at the very end of the call, Vonage disclosed a $39.95 disconnect charge if I leave them before two years. Yikes! It costs $40 to STOP being a customer? No thanks Vonage, but I still think your commercials are clever.
I'm glad I waited for ooma. The installation was easy, I trust that their engineers have designed a secure system and the call quality is very good.
- by skellener August 13, 2008 6:45 PM PDT
- Lots of inaccuracies in the article. Look here for the FAQ:
- Like this Reply to this comment
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(7 Comments)http://www.ooma.com/learn/ooma_faq.php
- Your one-time ooma purchase eliminates monthly charges for unlimited US calling.
Where did the three year thing come from? NO MONTHLY CHARGES!
Period. There are additional features available for a service fee, but only if you want them.
- The ooma system is flexible enough to work with or without a basic landline. All you need is a high-speed Internet connection and a regular home phone.
Having a landline is an option - but is NOT required.
Price is now $249 and comes with both an Ooma hub and one scout. I have no idea where they got the $599 figure for 2008. Electronics always go down in price not up.
Most of the reviews I have read have given the sound quality as BETTER than landline.
This is the second review I have read on CNET that has completely wrong information on it.