I recently bought a Magic Jack to evaluate, and I finally got around to moving the house phones over to it. Unfortunately it is not yet possible to port your number to Magic Jack, so for the time being I have forwarded my Packet 8 number to the Magic Jack number. We will see how it goes. In the mean time I am looking at ViaTalk again since I can port my number to them and it will end up being about 1/3 of the price I am paying for Packet 8. They also have many more features that Packet 8 has not even dreamed about yet. Just worried about the stability, but I will get around to that.

Read the rest of this entry »

I do not want to comment much about the credit crunch except as it influences technology. I wanted to bring a warning to people who use Vonage about something from my personal experience with VoIP. SunRocket went out of business suddenly and without warning leaving me and thosands of other people without service including 911. They managed to keep some people’s lines going from what I understand, but mine was immediately cut off. Vonage’s most recent 10Q talks about their debt and gives some warnings. If you have Vonage I encourage you to take a look at their investor relations pages and read this information for yourself. I’m not suggesting that they won’t secure the financing that they need to stay in business, I’m just giving a warning that you may want to do some research now on what you would do should your phone suddenly stop working. It was a mad rush to other VoIP providers when that happened, and I was already testing Packet 8 on the 30 day free trial, so I had it relatively easy.

Just at a minimum make sure you have a cell phone handy - even one without a service plan will work fine for 911 calls and won’t cost you a penny except to keep it charged.

On the same subject, you may want to look at other publicly traded companies that you do business with to see what their financials look like. I’m not suggesting you break off with Vonage or anyone else, because that will only increase the problem, just that you make the most of the resources that you have and make smart buying decisions. It is my opinion that this thing will blow over more quickly than most people expect, but more companies will go under before it is over.

UPDATE: Vonage having trouble selling its debt.

UPDATE (10/20/2008): The criticality of the deal is over, Vonage refinanced its debt, but the terms are not great.

I really thought Microsoft had some clue where they were going with those Seinfeld advertisements, but it appears that they were just as clueless as the rest of us. It is sad really. I was hoping for some of those “Oh, I get it!” moments as the advertisements continued. Instead we get a failed advertisement campaign similar to the failed Vista launch. What is Microsoft doing correctly these days?

The one thing that I hope was a good move was partnering with Packet 8. As Vonage tanks due to overwhelming debt, Packet 8 continues to rise as the VoIP leader. I hope the Vonage folks take a lesson from the Sunrocket debacle and start thinking about options to change their phones to another service NOW so that if it does happen you are prepared as much as you can be. When Sunrocket disappeared I was in the process of evaluating a free month of Packet 8 and so I got a jump start, but I know many people were burned pretty badly.

One day just suddenly, Sunrocket’s dissolution was reported all over the news. We didn’t get any warning from them at all. My reaction was this: My service was through Sunrocket and currently incoming phone calls are receiving a fast busy. We are still able to call out, but if you are trying to reach me you’ll need to know my cell phone number. I will get this switched soon. My primary choices are Packet8, or ViaTalk. ViaTalk has the most comprehensive feature package and has responded quickly to the news http://vtinside.com/blog.html but I am partial to Packet 8 because of it’s long-time existence and numerous VoIP patents.
My decision was made quickly: It is a tough decision to pick which provider to go with. Vonage is expensive and in trouble with Verizon so I’ve left them out. ViaTalk has the best feature set and great prices, but they say it will be 5-7 business days even with expedited processing and overnight shipping before I’ll see a device. Then I’ll still have to wait for the number to be ported. Packet 8 says they can port the number in 2-4 weeks, but this is their standard answer, and I have a feeling that it will be faster. ViaTalk is completely overwhelmed with people signing up for their service. Since this is likely to better than double their business, I am unsure if they are equipped to handle the onslaught, and expect that they can’t be far behind SunRocket in the going out of business club. Packet 8 on the other hand is a 20-year old communications company with dozens of patents regarding VoIP technology. I think they have the longest staying power of any VoIP provider out there besides cable companies and landline phone companies who also provide VoIP. I’m going with Packet 8. Call me on my cell phone until my number ports.

The 911 issue has always been a concern with VoIP - if the power goes out so does your 911 service. Well, I use a UPS, but that doesn’t protect me from ISP outages or VoIP company outages. I feel secure with Packet 8 knowing that their company is making a profit.

Full Disclosure: I do own a few shares of Packet 8 common stock.

Consumer level Voice over IP (VoIP) hasn’t taken off as much as it probably should in the United States. The most telling reason is that so many people don’t have a reliable high speed Internet connection. The other reason is that the technology is just not understood. A brief review of services that I have used is included below. For the techie we also worry about net neutrality. I’ll write about that later.

I recommend that anyone setting up home based VoIP invest in a good UPS as well so that the phone works during power outages.

Vonage

This is the company that everyone knows about. The advertisements on TV and plastered across the Internet have found their way into almost everyone’s home. Their service is solid and feature filled, however their financial situation is shaky. All that advertising has to come from somewhere, and right now it is the stockholders who paid for it. Many customers were given the opportunity to buy in when the company had their Initial Public Offering (IPO), however they were also disappointed when the stock price started falling. Those who invested purchased stock at $17 which is now worth less than $2. Most probably no longer hold it, however there may be a few die hards out there who do. In any case, Vonage has a lack of good will by its stockholders and by its customers. I recommend staying away. The Vonage device that I tested had a noticeable hiss in the background that never could be completely eliminated. What was suggested by the Vonage support people were using a DSL filter, a wireless signal transfer system, and/or placing a resistor on the 2nd phone line from the Vonage box. The resistor did end up mostly doing the trick, however how they could expect their customers to do this to make the product useful was beyond me.

Packet8

The second most popular VoIP company. This company has not been doing so well on Wall Street, however their array of patents, solid service, and practical policies on advertising make this a much better buy than Vonage. Of all the companies tested, Packet8 sounds the most like a regular land line telephone. They also cost the most like them. Packet8 charges fees above and beyond their set rates for things like E911 service and number portability. These are usually combined into the bill by other VoIP companies. Expect to pay over $30/month for their $24.95 plan. My bill is $31/month even. This is still my top pick in spite of the cost, and in fact because of the cost I believe that this will be the company with the most staying power of any other standalone provider.

Lingo

Lingo has a decent service comparable to Vonage, however their customer support is foreign and non responsive. My first experience with Lingo was pretty awful. I received their device and installed it and later that night, somewhere around 2am, I got a phone call from Lingo support demanding to know where I was located. There was no “hello” or anything, just “What country do you live in,” “Where do you live,” etc. I called the next day to complain about it and they said it is standard practice because some people were buying them for use in the USA and then shipping them overseas. Well, I can understand they want to check that, but do a reverse lookup on my IP and call me at a decent time for my EASTERN USA timezone. Not 2am! Lingo has a bad habit of having their service fail on a regular basis. Support tickets will go unanswered until they resolve the problem then they will claim that they couldn’t find a problem and close the ticket. This is the reason I finally moved on.

Bundled

The largest advantage with a bundled service is that many of them offer a quality of service guarantee that is nonexistent with other providers. When the same company owns the last mile as well as your telephone service, they can prefer your voice traffic over all else. If contention arises with any of the other providers, the Internet provider can easily drop you packets, or treat them exactly the same as any other traffic, and delay them. The net neutrality issue is not an issue with a bundled service.

The biggest disadvantage to bundled service is that you can’t take it with you. One of the nicest advantages with other VoIP is that you don’t have to change your phone number when you move or even when you go on vacation. When your VoIP service is tied with a local provider, then you have to find a new local provider when you get to your destination. Any of the other services can move around, be taken on vacation, etc and still work just fine. You should be able to port your number still, but not having to re-buy phone service is a plus.

ViaTalk

I recommend staying away from this company. Their customer service is always backlogged, and their website makes promises they don’t intend to keep. For example, if you select overnight shipping it tells you that orders by a certain time will arrive the next day. This is not true as I confirmed personally with their support staff - they never ship the same day they receive an order. In spite of the customer service issues, it is still a good service according to many reviews. They have more features than any other provider, and once you get it installed you have a good chance of never needing to talk to their service department again. The price is roughly half that of anyone else if you get the 2-years for one deal and can afford the $200 up front. I can’t tell you how many times I have been tempted to try them again.

SunRocket

This provider went out of business almost a year ago. I list them here as a warning to consumers who are looking to get into VoIP. Many users who had this service when the company went out of business had pre-payed as much as a year in advance. Some users had their service instantly dropped the day the company went out of business. Some users were able to keep their service for a short while, allowing them to find another provider. I suspect that most of these customers ran back to traditional phone companies, however many of them found their way to other providers. As much as possible, research the company you intend to transfer your phone number to - you don’t want this to happen to you as a consumer or as a business. Publicly held companies are better because of their more open financial information and their duty to shareholders. Vonage and Packet8 are the two I know about and it shouldn’t be hard to figure out which one is likely to last the longest.