ooma's no free ride

The ooma self-contained VoIP box is not the phone bill vanquisher it appears to be. The gizmo is positioned to replace outside VoIP providers. Instead of paying Vonage or Cox a monthly fee for VoIP, there's a one-time charge for the ooma Hub from the eponymous Palo Alto, Calif. startup--$399, now $599 as of 2008.

ooma promises "a unique, refreshing dial tone," unlimited domestic calls, cheap international rates, and the usual buffet of features. Orders are being taken now; units are expected to hit the market next month. Executives at the startup, which debuted in June, include veterans of Cisco, Yahoo!, Redback Networks, and tech newcomer Ashton Kutcher, whose celebrity glare could be obscuring the carefully worded caveat embedded in the company website FAQ:

"Your one-time purchase of the ooma Hub device means you won't owe monthly charges to ooma for unlimited calls in the United States for at least three years. Should you want the assurance of a basic landline as an integrated backup (in the event of an Internet or power outage), you can reduce your monthly bills by slimming down to low-cost, bare-bones service."

The caveat, in 6-point grey type at the bottom of the FAQ [1] page, goes on to say that the landline can be cut, but Deb Shinder has her doubts. Shinder, a technology consultant who lives near Dallas, discusses how the ooma hub relies on the last-mile to make local connections in an entry at TechRepublic. Everything in between is routed on a peer-to-peer IP network, bypassing the traditional telephone interconnection architecture and its concomitant fees. An ooma call from Miami to Seattle resembles a next-door connection.

Shinder also speculates about whether ooma has 911 capability without a landline. ooma spokeswoman Amy Sezak responds, "With the non-landline version of ooma customers can use E911. In order to use regular 911, users should keep their landline."

For more:
- ooma's pre-sale announcement is here [2]
- Shinder's TechRepublic entry is here [3]
- ooma's management team bio page is here [4]

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