MagicJack figures out how to do completely free calls

MagicJack's USB dongle is king of the infomercial led free-after-the-initial-purchase consumer VoIP, but now it has sweetened the pot.

The USB VoIP device goes for $40 down and then $20 a year (after the first free year) for unlimited VoIP calls to telephones (not just to other MagicJack users or computers). Although the deal sounds pretty sweet, but MagicJack is now launching a new service that will mean truely free calls. The MagicTalk service is a software release of the MagicJack service, but it makes its money charging phone companies for incoming calls to MagicJack users. Initially supporting Windows and Mac, MagicJack plans to release a mobile phone version soon. Each user gets their own MagicJack number with the option of transferring their own number to their MagicJack service.

MagicJack's idea sounds like a win for consumers and it's pretty tough to compete with 'free.' It will just be interesting to see if the company can make enough money to keep the service afloat on just charging fees to other telephone companies.

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