July 26 August 1, 2010

Bloomberg Businessweek
From 2000 to
2008, the number
of American home
phones declined by
more than 60 million

Etc. Hands On

Home Phones Last Gasp

The Web-based Ooma Telo is
helping keep the home phone
alive. By Arik Hesseldahl

sk anyone under 30 for their home

phone number, and they may look
at you funny. The landline business
is in permanent decline. After peaking at about 141million in 2000, the
number of U.S. home phones fell to
78million by the end of 2008, according to the Federal Communications Commission. While most of
this erosion was the result of people going wireless,
the FCC says some 19million households replaced
landlines with Internet phones.
For the last month Ive been testing the latest Internet calling device, Ooma Telo, which offers people
who might otherwise go all-wireless the security blanket of a landline-like phone. Recently redesigned and
vastly improved from its unimpressive first-generation product, the $250 Telo is essentially a small computer that, when connected to the Internet, works
with your existing home phone. For a one-time $40
fee, you transfer your existing home number, enjoy
great rates, and eliminate your old phone bill. Think
Vonage without the monthly fees.

i
Ooma Telo and
Handset
The device ($250) and
optional handset ($50)
make calls over the Net

Setup was straightforward, starting with creating an Ooma account online. Then I connected
the device to my home router. After waiting five
minutes for the Ooma to boot up, it was ready for
use. I tried it with Uniden cordless phones, a 1980svintage AT&T Trimline, and a wireless Ooma Telo
Handset ($50). All sounded good; only twice did
jarring echoes interrupt a call.
With Ooma, domestic calls are free, with exceptions: No 900 numbers or phone chat services, and
411 calls cost 99 each. There are some taxes and
feesNew Yorkers and Californians should expect
to pay $3.47 per monththat can be skipped by upgrading to the Ooma Premier service for $9.99 a
month or $119 a year. Unlike Vonagewhose plans
range from $9.99 to $35 per monthOomas packages are optional.
The Premier package has features your rotary
phone never dreamed of: You can forward calls
to your cell phone, and a Web-based voice-mail
system lets you listen to your messages from any
browser (or get voice mails by e-mail). International calls require prepayingcalls to France run from
2 to 5 a minuteand the Ooma works anywhere
theres a fast Internet connection, so you can take
it on the road. Had the old phone companies been
this flexible, they wouldnt be watching their business evaporate. <BW>

photograph illustration by credittk