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VoIP: Not The Cheapest Calling Option?

? Startups and Second Chances: The Jawbone Story |


| Microsoft and Content Protection: Where's the Love? ?

December 26, 2006

VoIP: Not The Cheapest Calling Option?

Olga Kharif

I just read Jon Arnold's blog on Skype. And -- surprise! -- Arnold thinks that since Skype recently raised its rates, the service, allowing for Web-based calls, is no longer the cheapest way for people to make all types of international calls. Traditional telcos' services can, in fact, prove to be cheaper when calling countries like Israel, he says. My personal experience shows that using prepaid calling cards is still cheaper when dialing Russia, meanwhile.

Indeed, as services like Skype, owned by eBay, start to desperately search for ways to make money, the notion that Voice over Internet Protocol (VoIP) calling is the cheapest way to make international calls may not hold true for much longer.

Just to be clear, I don't think that's going to stop users' migration to VoIP -- a migration that, according to In-Stat, is accelerating in the U.S. Still, higher prices could cramp VoIP's image as the cheapest phone service around. And, ultimately, this could slow landline-to-VoIP migration down a bit. After all, most people move to VoIP because of its low price. And if VoIP prices keep on creeping up, some consumers may stick with their traditional telcos longer than some analysts expect today.

12:12 PM


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? VOIP cheap or notcheap? from Let's think

BW blog has a blog on how VOIP is not the cheapest option for calling international. However, I feel that going VOIP is not just about international calls, it provides more options for the same buck(s). I just got a mailer from AT&T saying that the... [Read More]

Tracked on March 20, 2007 03:11 PM

After being concerned about security issues and countries tending to ban Skype my associates and I went to Gizmo Project ( We've found it to be more reliable and based on standards that exist today...none of that proprietary stuff. Of course, there are other alternatives. But, not having tried every one of them I can neither say "yay" or "nay" on their abilities to be viable.

Posted by: Rob Roberts at December 26, 2006 08:18 PM

i still think free pc-to-pc is a good deal, and i already signed up for $14.95 unlimted calls for '07. standards-based would be nice, but the average user doesn't know or care...

Posted by: jason kibbe at December 27, 2006 04:34 PM

So, telcos can offer better rates to Israel and russia? Gee, that's great, I'll never need to call either place in this lifetime. Meanwhile, with my Vonage account, I can call the UK, Spain, Ireland, France, Italy, and Germany for zero cents, twenty-four hours a day, seven days a week. How are your telco buddies doing versus those 'rates'...?

That's what I thought. Next. Nice try though, but shilling for the monopolists is so Reagan-era.


Brian Stegner


Posted by: Brian Stegner at December 31, 2006 01:34 PM

Tomatovine is a piece of crap company. I signed with them due to advertising on Stern show. They about put me out of business.

Posted by: Mike at December 31, 2006 05:33 PM

In this case - the saying "money isn't everything" is true! Minutes are so cheap that it really doesn't matter anymore to the average person.

What does matter is how my phone system allows me to communicate and collaborate efficiently with my workgroup, family and friends.

That is the reason for companies such as and the Flat Planet Phone Co. For more on this read

Posted by: Moshe Maeir at January 4, 2007 04:12 AM

I don't think the rising prices of just one company, in this case Skype, to a couple specific countries can lead to the conclusion that VoIP is not cheaper than traditional landlines. Vonage, who granted seems to be a sinking ship, is offering pennies per minute. Once more competitors come into play, pricing will lower. Supply and demand.

Posted by: vic at March 20, 2007 01:02 AM

VoIP can be an effective solution for many companies, but service & reliability are always important. Vonage learned this the hard way with their QoS issues and lack of 911 capabilites. IMO, businesses will benefit more from VoIP than household users.

Posted by: SB at May 3, 2007 05:25 PM

I use skype for international and domestic calls. The quality has improved since they started charging for the service, it's still cheaper than any other service. Personally I use a voip cell phone, with few acceptable glitches, skype works fine for me.

Posted by: John at May 8, 2007 02:02 PM

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