Sunday, June 28, 2009

MagicJack revenue more than 100 million dollar, recession?


We don’t talk about vonage anymore, its all about MagicJack now. MagicJack, the cheap internet phone gadget, using which, consumers can make unlimited calls via a USB jack. The service works by hooking up a standard home phone to the USB jack provided by magic jack. The USB jack is sold via stores like Best Buy, RadioShack and Walgreens. The price of the USB jack is $40. For the first year, unlimited calling is free. After that, its $20 a year. I remember paying more than $30 for a month for landline, and this one beats the price by a mile. The downside with the service is that you need to keep your computer powered all the time. So there is some money you pay for the computer power consumption.

The company sells about 9,000 to 10,000 units per day, and according to the Borislow, CEO of MagicJack, the company will make more than 100 million dollar revenue. Looks like recession has no impact on this company.

What is the Magic behind MagicJack service? It has its own network to support voice calling. Its parent company YMax communication is actually a CLEC (Competitive local exchange carrier). Unlike other internet phone companies who pay to get phone numbers, YMax as a CLEC doesn’t have to pay for phone numbers. ( Remember Google voice bought 1 million phone numbers via Level 3 communications) In addition, they make money via inter-carrier termination charges. Check out their YMax CLEC rates.I doubt if they generate all their revenue via inter-carrier termination charges. I guess this could be one of their cash cows. They still have to pay for Call Origination from the MagicJack phone. Don’t know how this is covered.

Who is using the service? Many older people, frequent travelers and overseas customers who want to make free cheap calls to America and Canada. They have some cool innovation up their sleeves; A Femtocell gateway that will allow consumers to use their GSM cell phone with MagicJack service and Number portability support.

For some Folks, MagicJack is a Scam and for others it’s a boon. Let me know what you guys think about MagicJack. Thumbs Up or Thumbs Down?

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7 comments:

Anonymous said...

You should mention about service quality, customer service etc.

Anonymous said...

MagicJack will save you money but it has some "gotchas." First, my contact list has been wiped out twice. I believe when they updated their software it just deletes all your numbers in the contact list. Second, MajicJack will just "die" when not in use and you have to reboot it - usually by unplugging the USB connection for about 10 seconds and then reconnecting. In addition, if you receive a call when it is "dead" then the call goes to voice mail.

They need to fix these problems to have a really "Great" product.

R Campbell
Houston, TX

Distantlifeline said...

I have bought over 20 MagicJacks for myself, friends, and relatives in Canada, USA, China, & Sri Lanka. I disconnected 2 landlines in Jan 2009 and have saved over 1,000 dollars until now.
There are some minor glitches which will improve with time.
The minimum talk time everyday is 6 - 8 hours.
The benefits o switching to MJ is priceless.
Aruna T
Calgary, AB, Canada

Anonymous said...

Hi,

I have found a lot of reviews about magic jack here.

Also this Magic jack video is funny...

Take care.

bryan said...

Magic Jack dies about once every three days. Sometimes, the device won't accept their software upgrades/flash and the last time, I spent almost 2 hours on the phone doing command line and registry entries on my one desktop to even get the darn F drive to reformat. The average Joe or Josephine couldn't do that.
NO, for cheap, I pay a little more and use Skype. Skype has never, ever let me down. Yea, I have to use a headset mike with my setup, my friend has a standalone Skype cordless that doesn't need the computer to operate. For 60 dollars a year total, Skype just sounds better and is more reliable especially in Wifi Hotspots.

Even with a Core 2 Duo, 3 gigs of ram, and a 10mps connection, Magic Jack sputters and has severe dropouts.If it wasn't for the voicemail forwarding aspect of the service, I'd lose a ton of calls.

NO, I give it a Zero out of Ten. Not even a good backup phone. SKYPE is much better

Pappy said...

It's a total piece of crap. When it does work, it gets chopier and chopier. Totally useless on a P4 Laptop with USB 2.0. All the devices were from a bankrupt West Indies company. Basically, people are trying to get something for nothing and LESS is what they get.

Junk. AND overworked online customer service.

bryan said...

MagicJack did another software upgrade this morning (8.19.2009) about 9:45am. (Lucky ME message. Right!). Keypad on desktop phone wouldn't work afterwards SO okay, I use the mouse to point-and-click the numbers in the inteface. Quality is really good for about a minute, then WHAM!. Drops call completely. Oh it gets better. Knocks this CPU completely off the net. Just to be sure, move the unit to the other CPU system. Comes up, make a call, WHAM!. Dropped Call...Off the net completely (Can't google, etc). UNplug the damn thing. Reboot. Everything is now fine as you can see.

20 bux ain't much to pay a year BUT if it doesn't work, then Consumer Affairs needs to come in, sue MJ, and either make them replace all the defective interfaces OR go out of biz. With 9 MILLION people online, I was able to make a glitch-free Skype call on a slow, low level wifi connection, on an ancient Dell laptop, with only 384 mgs of mem for an hour without a prob. Crystal clear. I pay 29 bux a year for that. Goes anywhere I go. Just flat works and if I do get noise, drop-outs, etc. I get an INSTANT customer report form to fillin what I experienced on that particular call. Again. MJ is JUNK and I betcha', it's got compliance issues as well (FCC, etc.)
Junk. Pure T Junk