Based on their breakdown, it seems that only $0.73 per month is the actual tax rate and Ooma is simply charging me $3.79 a month. This is further evidenced by the fact that services like Magic Jack are now cheaper than Ooma.
I still consider $54 a year a considerable savings when compared to a standard line (or even Vonage). I'm not really considering the cost of Ooma equipment and the necessary internet service, but that's okay.
My issue is the fact that Ooma is clearly charging for service now while continuing to advertise as "free".
I assume they're only doing it because I signed up for a "free" service in 2009 and if they admitted they are charging, they might have trouble charging existing customers.
Vonage example:Erick wrote:.....Ooma is clearly charging for service now while continuing to advertise as "free".
Monthly Service Charge $25.99
Emergency 911 and Information Services Fee $1.99
Federal Program Fee $3.33
Regulatory, Compliance and Intellectual Property Fee $1.99
Sales Tax $4.11
If you subtract the service charge of $25.99 from the total, the total RRF/sales tax = $11.42 (this is more than twice Ooma's RRF in your area...2.538 times to be more precise). Unless you consider part of this $11.42 that Vonage charges as "service charge," don't think your statement would be fair. Ooma phone service is still "free" because there isn't this $25.99 service charge month after month.
In my thinking, I don't think folks have any bones to pick until Ooma monthly taxes are higher than what a basic landline or Vonage would charge in taxes. So far it is not.
As for MagicJack...
lbmofo wrote:...It's just a matter of time before those guys get in trouble; when the fat lady sings, I think they will fall hard: http://www.fierceenterprisecommunicatio ... 2011-01-18 No telling how hard the government will come down on them.
Also consider, Good Quality vs. Poor Quality
Are you serious? Your only argument against Ooma suddenly multiplying their fee by over 4.5 times the previous rate is... it's still cheaper than Vonage?lbmofo wrote:In my thinking, I don't think folks have any bones to pick until Ooma monthly taxes are higher than what a basic landline or Vonage would charge in taxes. So far it is not.
First of all, you need to re-read my post. I already clearly pointed out my feelings on the price comparison against Vonage and land lines.
Secondly, value is highly relative. You alone do not set the bar for everyone else on when they should or should not complain about cost.
Quoting yourself was priceless. I already read your post; I had ignored it because you presented no real concern worth discussing. Since you're forcing the issue of your baseless argument against MagicJack, I suppose I should respond.lbmofo wrote:As for MagicJack...
Your opinion of the survival of MagicJack is inaccurate and unfounded. The reference you link to is nothing more than a news story about West Virginia attempting to get 911 taxes out of MagicJack. So what? Instead, I have a far more relevant article for you:
http://community.nasdaq.com/News/2012-0 ... yid=127034
As everyone can plainly see, MagicJack has been substantially outperforming the Dow Jones and S&P 500 market average.
So where is your evidence that MagicJack is failing? I see the opposite.
At best, your only valid claim would be that MagicJack might need to charge customers to reclaim 911 service taxes. Do you realize that my local state tax for 911 service amounts to a whopping 50 cents per month?
So the point still stands that MagicJack is cheaper than the supposedly "free" Ooma service.
More importantly, I hope you understand the business model Ooma has claimed:
http://www.fierceenterprisecommunicatio ... 2009-03-19
In short, Ooma has always said that their profit stems from selling hardware at a premium and the percentage of users that order Premier. Not from monthly fees.
Regardless of the false promises Ooma has made, I'll reiterate my previous post: I am satisfied with paying $54 a year for a VOIP phone line. If that is the cost of business, I would rather Ooma remain successful.
However, my problem is that they are continuing to market themselves as "free". This is an obvious a lie as they've begun hiding fees behind the guise of tax charges. I want Ooma to be honest with us!
I clearly said "in my thinking" on people having bones to pick.
As for MagicJack, I wasn't talking about them failing. I was talking about them getting in trouble with the government. I feel kind of bad for all your wasted work on how great they are doing.
Bottom line: Ooma website says Free Home Phone Service. You pay only applicable taxes and fees. No deception.
Also: Ranked #1 Phone Service in a leading consumer publication survey. No deception either.
Rest assured, it hardly took long to show evidence that contradicts your sentiment. It was simply a matter of looking to Google Finance. Conveniently, the NASDAQ article was the top news item. It's no secret that MagicJack is doing quite well.
This is where you're wrong. As I've repeatedly pointed out, Ooma is clearly charging for service now. It's really quite logical considering MagicJack is cheaper. Please explain your particular grasp of mathematics that somehow allows a direct competitor to cost half as much as "free".lbmofo wrote:Bottom line: Ooma website says Free Home Phone Service. You pay only applicable taxes and fees. No deception.
Bottom line: if Ooma was truly "free", they would be the lowest cost solution available. They are not.
MagicJack topic above demonstrates your unwillingness to listen/adjust.
"Free Home Phone Service. You pay only applicable taxes and fees." Show me another person that thinks this is a lie and then maybe I'd reassess my thought process.
BTW, just to be sure you are clear, I don't work for Ooma. I am just like you, a subscriber.
While I believe that the taxes imposed probably have gone up, I also suspect that, reading the fine print of the explanations, the "cost recovery" portion of the fees probably also includes "profit recovery". This is often pointed out whenever I read an article on why a $30 telco line costs $50/month - the taxing authorities are not getting $20, but the telco saw a way to help themselves to an unregulated price increase, as long as they don't get too stinkin' greedy and trigger the regulators.
Vonage and Ooma have no regulators, but they seem to have borrowed the tactic. Vonage, thinking they had a user base locked down, evidently tried the same crap, as my $25/month service crept up to $37/month over time. As a result, they lost me as a customer.
There are cheaper alternatives to Ooma. I'll stay with Ooma as long as the service is good, competitive, and they don't lie. The "don't lie" part of that is important to me, because I believe strongly in doing business with ethical companies. Advertising "free" except for "taxes and fees" is pushing the edge now.
I'm not quite "another person" but I'm close. The fees include "cost recovery" for compliance, which, if the telcos are any example, can be jacked up to include "profit recovery". If Ooma wants to be transparent, they can break down the taxes and fees into the portions that actually goes to governments vs the portion they take to "reimburse" themselves for compliance.lbmofo wrote: "Free Home Phone Service. You pay only applicable taxes and fees." Show me another person that thinks this is a lie and then maybe I'd reassess my thought process.
The marginal cost of compliance should be fairly minor. I'm not calling out Ooma as liars yet, but I'm watching.
Regulatory Compliance Fee $1.78
911 Service Fee $1.59
Federal Universal Service Charge $0.39
These amounts didn't see a hike yet as far as I know from inception of monthly taxes.
My current breakdown is: Reg/Comp fee = $1.78, 911 Service fee = $1.59, Fed USC = $0.39, State & Local taxes, etc = $2.06.
I'd like to know who increased my monthly tax/fee by $2.09/month (an overall increase of $2.35 since January). That's a big jump.