How to save on your phone bill

I already wrote in the past about ways to eliminate your TV subscription costs (you can read about it here), so if we can save on TV with the help of the Internet – then why not on the phone as well?

The phone companies have really gone too far, in my opinion. In my area, the lowest AT&T subscription is around $20 ($16.45 + taxes, to be precise), and it’s only for local calls. Voice mail? No. Waiting call? No. Call transfer? No. I mean, really, it’s the twenty first century out there, get a grip people!

So, what can we do about that? First of all – cancel your “conventional” phone service. You’re paying fortune for something that doesn’t worth even tenth of what you’re paying your provider.

Now, that we’ve done that, what are the alternatives? It is the VoIP of course. Voice over IP. Or, more commonly, Internet phones. There are several different providers of VoIP services, I’ll just mention a very few, and you can compare the services yourselves.

1. Vonage – The current promotion says that for only $14.99 ($25.99 after the first 6 months) we can get unlimited local, long-distance and international phone calls (incoming and outgoing, and Vonage allows calling cities in 60 countries). Additional services included are voice mail forwarding to your email, anonymous calls block, and other perks. Nice, but the prices are still a bit on the high side. The benefit, though, is that you get a converter that will allow you using your old regular phone, and you’ll also be able to call 911 for emergency services. So, could it get any better?

Yes it could.

2. Skype – one of the first in the business, provides free calls among subscribers (voice, chat, video). If you want to call real phone numbers, then the cost is (currently) $12.95 per month for unlimited world-wide calling. That’s cheaper than what AT&T ask for just local calls. Even if you read the fine print (the unlimited is only to landlines, and the world on the Skype globe is smaller than the Vonage one – only 40 countries, including US and Canada), it’s still a way better deal. But if you only need to call your friends in the US and Canada, it is even cheaper – $2.95 for unlimited US & Canada outgoing calls. Combine it with a $5 a month for the incoming calls (you can choose your own number in any area code), and you get less than $10 subscription for a full-blown telephone service with unlimited incoming and outgoing local and long distance calls, and all the additional services (like voice mail, call transfer, etc) that the telephone companies usually charge extra for. Ah, and you also get discounts if you combine subscriptions. So, if you make a subscription for a year – you’ll pay something like $7 a month for the whole package. AT&T, did you hear that? The main problem with Skype is that you have to either get a compatible phone (costs around $100), or be connected on your PC. But, isn’t your PC on all the time anyway? My is. Anyway, could it get even better than this? Yes it could!

So, what can be better?

3. Magic Jack – Magic Jack is a USB device that connects to your PC, and you can plug your old phone into it on the other side. Yes, it means that, like Skype, you’ll have to leave your PC on. And, like Vonage, you’ll need a piece of hardware be shipped to you. But, look at the prices! The subscription includes unlimited incoming and outgoing calls anywhere in the US & Canada. The device itself plus the first year subscription are for $39.95, and after that the (current) yearly subscription is $19.95. That’s less than $2 a month. Compare to the $20 that AT&T wanted to charge me for the local-calls only service. And yes, it includes voice mail, waiting call, and international calling for additional charge. No, no taxes, thank you for asking, same as Skype.

But it isn’t all that perfect, of course. There are some limitations for these services as well. For instance, you have to have your PC on (unless you purchased a special Skype phone, or have Vonage).

Also, there are some issues with 911 calls on Skype and Magic Jack, be sure to familiarize yourself with those issues.

Skype services are available anywhere in the world once you made the subscription, while Vonage requires a US shipping address for the shipment of the kit, and Magic Jack has to be purchased at a store (or online) and be shipped to you.

Skype you can use on any computer – just download the software and log in (you can even use it on your iPhone or iPod Touch, when you have a WiFi connection available, and save on the cellular bill), Vonage and Magic Jack require the hardware devices to work. Magic Jack can travel with you anywhere in a pocket, but you have to keep it with you on the road, so it’s less convenient than Skype for travellers. Vonage can move, but probably won’t. Too big a box.

Oh, and you need a broadband internet connection to use a VoIP service.

Overall, each of these options has it’s own benefits and drawbacks, as any other service. But comparing to the traditional telephone services and costs – all the three are way better than the plain old jack in the wall with $20 bill for local calls only.

So, enjoy your new phone service!

Your Little Advisor

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