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Is YMax magicJack a Scam?

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MagicJackIn a recent issue of the Retirement Millionaire, a retirement newsletter I’ve been checking out, they mentioned some frugal VOIP option I hadn’t heard of before. MagicJack is a USB based device that lets you make phone calls using your PC’s internet connection for $19.95 a year, or $1.66 a month. I currently use Skype as my VOIP service, in part because of weekly hour-long chats for the Personal Finance Hour, but that costs twice as much for unlimited US calling – $2.95 a month ($35.40, plus international fees because Skype is based outside the US).

I’m always looking for a good deal :) so I thought I’d take a closer look.

How Does It Work?

You buy one of these magicJack units (if you’re going to buy it, don’t buy it from Amazon because you can get it elsewhere for cheaper, I linked to them so you can read the 160+ reviews more easily) for around $40 and plug it into your computer. You then take your phone and plug it into the magicJack unit and viola, you have telephone service across the internet.

So what do you get for the $40? You get free service for the first year, which is normally $19.95, plus a phone number and unlimited local and long distance calls.

Risks

The product itself is not a scam but there are some significant risks you need to be aware of if you want to replace your regular phone service with magicJack.

Your computer needs to be turned on and your internet connection has to be active for you to make any calls. If you have a power outage or internet problems, you’ve just lost your telephone service. As for your computer, if you keep it in top notch condition, you probably will be fine. If you don’t, any slowdowns or blue screens of death are going to kaput your telephone capabilities as well.

In normal scenarios, that’s all fine. If you can’t make a call or have to reboot your computer, not a problem. However, in 911 scenarios, you might find yourself out of luck. If there’s a power outage, you can’t call out. Corded phones are powered by the RJ-11 phone lines, so in some power outages you can still call out (in an outage cordless phones are usually dead too).

Finally, the End User License Agreement for magicJack gives them the right to include advertisements. The Coffee Desk, in their review of Magic Jack, pulled up this gem:

You also understand and agree that use of the magicJack device and Software will include advertisements and that these advertisements are necessary for the magicJack device to work … Our computers may analyze the phone numbers you call in order to improve the relevance of the ads.

Hmmm…

Awards

It turns out that back on January 17th, 2008, PC Magazine named it an editor’s choice, saying “So simple it’s almost perfect, the magicJack is the best home voice-over-IP gadget I’ve seen to date. Excellent call quality, a workable set of calling features, and an amazing price make this little box the VoIP wonder to beat.” (link)

But that was almost two years ago, what about today? In looking at the reviews on Amazon, they run the gamut in star ratings. You have 50 5-stars and 59 1-stars… I think this 3-star rating by Double W sums it up: “MagicJack is a mixed bag. It will save you money, but you do get what you paid for.”

If you’re itching to check out another review, Matt at Steadfast Finnaces swapped out Vonage for MagicJack and shares his opinions. For him, it dropped the price of phone service from $300 to $20, not $35 to $20, so I’m not surprised to hear he was pleased.

For now, I’m going to pass. It’s not a scam but there are enough “yellow flags” (things I consider headaches, but nothing “bad” necessarily) that I’ll just stick with Skype. Since I have a cell phone, replacing Skype with magicJack doesn’t seem like a good value.

Have you used it? Know someone who does?

{ 72 comments, please add your thoughts now! }

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72 Responses to “Is YMax magicJack a Scam?”

  1. T. says:

    We’ve been using MagicJack and love it! I think the variations in call quality have to do with the quality of your internet connection. We’ve got Fios, so we’ve got really good call quality (since it uses the same lines anyway).

    I use an old laptop for magicjack only. That way it doesn’t interfere with my regular computer or internet service, and I don’t really care what ads they put on, since I don’t see them anyway.

    I’ve known several people who used other VoIP services (Vonage, Optonline) and left as soon as they could. I like that magicjack is cheap and easy, and having used it for over 2 months, I’m already making money on it (old service was $25/mth + taxes & fees), so if I felt I needed to move to another service, I wouldn’t feel like I’d thrown the money out the window.

    It was easy to set up, although I strongly suggest doing all your computer maintenance before beginning the install process. Stupid Windows decided to download something in the middle of my install and I had to finish that, reboot, then install the magicjack again.

    Used Skype for years and love it too, but in the end, magicjack was cheaper and easier for us. Reduced our 2-line phone bill by $1,180 a year.

  2. Izalot says:

    This sounds neat. Can you use it for a dedicated fax line? Is there any VOIP service that can be used with faxes?

  3. Paige says:

    I was somewhat interested in MagicJack after seeing the infomercial, but didn’t know anyone who had used it. Seems like too much of a hassle after reading the comments. Thanks!

    • aua868s says:

      they have return poicy..dont remember it completely…but you should try it, definitely worth it.

  4. PA Mom says:

    @ Roofer for a summer

    I had Vonage for years and the voice was always crystal clear, forwarding worked great, etc. I had zero problems with their service. We have a cable modem for our internet so maybe that was why? When I wanted to cancel, I called customer service and had it canceled within a couple of minutes. If I wanted a house phone again, that’s what I’d go with. It was just one of the services we cut or eliminated due to unemployment.

    Compare that to MagicJack, which I couldn’t get to work even after hours on the phone with their tech support? Well, basically no comparison. Sure MagicJack is cheaper, but what good is it if you can’t get it to work?

  5. eric says:

    Yeah I was debating too but ended up not doing it.

  6. Brad says:

    We use our Verizon Family plan for most of our calls but did not want to fully give up a home line. Majic Jack has been working fine for us but as others have said, I believe its all in the setup & connection. I have a 6-10 mbps connection and MJ is running on a dedicated PC by itself (phone server). Its a bare-bones system I put together with an old motherboard/CPU, 512 ram, 10 gig hd and a small 200watt ps. Working like a gem. If you try and use MJ on your main PC I can see where you would have constant resource issues/contention.

  7. Sal MBA says:

    Magicjack customer service absolutely sucks. I used it for 2 months and worked well. Then I used it on win 7 new install, it uploaded automatically new software and screwed up the hardware. I spent months with customer service and they can’t do anything.
    Save your money with these people.

    • T. says:

      Anytime MS changes operating systems, there are significant numbers of applications that won’t work with it. Given that it worked well before, but not with Windows 7, that’s probably your problem. I have no doubt that they’ll get it worked out, but it sucks in the meantime.

      That’s one of the reasons I stuck the MJ on an old laptop here — no OS issues.

    • aua868s says:

      thanks for the info…i was planning to update my OS to windows 7….looks like i will have to wait a while till MS figures out ways to rectify issues.

  8. Kate says:

    I’ve bought the magic jack in Canada. Paid 60$ for it. It worked for a week, very spotty and dropped calls and then died. after numerous calls and complaints on my behalf they promised to replace it. They never did. I never got a phone call back. Never received a package in the mail. I left a message on their answering machine numerous times. AVOID AT ALL COSTS! This company is a joke.

    • byrd says:

      i am also in canada, and bought the MJ for $40 CDN (the price is the SAME in the U.S. but in USD). i went home and plugged it in and it worked perfectly. paid an extra $10 when i registered to get a local canadian phone number and now my friends can call me as though i have a local landline. yes, your PC has to be on and yes, there is no 911 service in canada but those are minor annoyances. my pc was on all the time anyway save a weekly reboot. i dont doubt people have had issues with the MJ but i have certainly had none at all!

      • styve says:

        Hi. my name is Steve from Victoria BC. I’m glad to find a Canadian user of MagicJack. Can you tell me if all calls are free once you own the device. Even call to Europe for exemple?
        Thanks Steve

  9. Gardeninguy says:

    Once the unit stops working, click on the menu button on the “soft phone” and select Help. You then have the choice of just going through countless FAQ’s or typing your question into the search box. Doing the latter does not answer your question but instead pulls up a number of FAQ’s for you to choose from.
    There may be a few or several to choose from and they may be related to your question or have absolutely nothing to do with it, more often it’s the latter. If you keep at it long enough, you might actually get to a page that has buttons that proclaim an instant response from a live agent. One click and you will see that it’s a lie.
    All you get is another list of FAQ’s to choose from and the same old search box to get other lists of FAQ’s with. The advertised Tech Chat and Live Agents are just plain lies. There is no phone number to call. There is no link to email to except for a publicity link and it is strictly for PR, not tech assistance.
    In fact, Magic Jack has no customer service. I managed to get to an agent at Christmas and spent an unreasonable amount of time with two agents getting the “Error 9″ message replaced with the “Ready to Call” message. The next day I found that it was anything but.
    Now, it is completely impossible to get any response and I can only conclude that the customer service staff has been let go. Why have customer service when you can just charge people for service and not provide it?
    People who’ve only recently received their jacks may be pleased with things. I was. Now, “I’m mad as hell and not going to take it any more.” I paid for phone service and can’t get it nor can I contact these fly by night thieves and get what I paid for or a refund.
    Magic Jack, in my honest opinion, is a company of lying thieves who should be prosecuted and imprisoned.

  10. Carl says:

    I tried using Magic Jack but it did not work for me. Their customer service sucks and you can’t call them. I tried to get my money back but still no word from them. I did file a complaint with the BBB.

  11. Michael says:

    I bought a magicjack just over a year ago and took it to my mother-in-law in South America. All of her calls to and from my wife are included in the annual rate. We have experienced a couple of technical issues but not overly horrible. Additionally, I have sisters-in-law in another state and those calls to and from south america are included too. So it has been an unqualified success for us.

    I have another unit I use when I am traveling on business outside the country so I can call my wife and speak as long as we want. I simply unplug the hotel phone from the wall and plug it into the magicjack again, all included in the annual rate. We just re-upped for an additional 5 yrs. Great product. I recommend it.

  12. Stephen says:

    Here is an important wrinkle you may not be aware of (and some specifics that MagicJack can’t / won’t answer despite 30 hours plus with their chat service). Where you live makes a difference n how well (or not well) your MagicJack works. This is similar to the dropped calls and voice quality cell phone issue most of us who live in rural areas are well aware of.

    In a nutshell it’s quality connectivity over their network, similiar but not the same as those missing cell towers (all over the Midwest FYI).

    Here is what I have faced in my attempts to get it working right at least 80% of the time (at roughly 40% currently and yes I am tech savvy). 1) Caller ID when I call my land line will show unknown or other area codes frequently. 2) Call quality outside my state to a large city works great….calls locally “suck” (and yes a land line connects to these numbers with no problem). 3) It can take from 10 seconds to 2 minutes (and more) to start ringing. 4) Of late I get a prerecorded message in Spanish that says the number is not valid (not true as it is on my call list – click and call) and half the time the call does do through. 5) Dropped calls come in three forms…..the call is lost like a cell phone, they can hear me but I can’t hear them and vice versa or it’s an every other word thing.

    With respect to customer service the first issue (and very likely for some significant portion of the customer base) are problems with the computer (meaning yours). I have tried it on three different hard wired computers, received a replacement MagicJack, swapped out my modem and ALL the problems still exist (come and go). Plus have endlessly gone through their normal “fix it” routines ad nausea. And the coup de gra…..or what will shortly be the end of my not so Magic (jack) experience will be NO RESPONSE to their promise to look at their network (in Kansas), servers, etc and get back to me via email. Two strikes thus far and waiting for the 3rd promised reply.

    So what’s the bottom line….(my opinion based on a lot of “chat” support homework)….if you live in a rural area and use it to call local numbers it will probably drive you to drink unless you have infinite patience, if you live in a rural area post a notice on a local bulletin board (meaning you want an opinion from neighbors) asking does it work reliably for local calls. Lastly, what is your time worth (or blood pressure) and are you at least a little tech savvy?

    This is my personal experience….I own a computer sales and service business but I actually sold (small town) 5….of which I have refunded the money for 4 to date. Needless to say I do not sell them now…the customer issue is not worth the few dollars profit (to say the least).

    Cost opinion….if you have someone you call a lot who lives where you can make a good call (remember the connectivity issues) it can (obviously) save you some money but if you depend upon it only (and more than likely live in a rural area) you might be better off with a cell phone, at least as back up). I have a pay by the minute cell phone (for on the road and in case I need to make an urgent out of the area call), a local number (with no long distance) and of course the Magicjack (until the subscription expires or they get back to me with a fix).

    Are there other solutions……you bet….since most of us have computers….Skype to Skype is free, you can video chat with anyone using a variety of services (and looming around the corner are those great guys at Google – If you read between the lines don’t be surprised at what they might offer free in the not too distant future).

    Good luck…..whatever your choice.

  13. Funnyness says:

    I Just don’t understand folks. its 40 dollars a YEAR!…. Its not going to be a complete replacement for your calls,… Use it as a add a line or for out of country calls, i use mine to call canada. works great as long as i’m not doing alot of downloading etc, the faster your connection the better the call. For the money i really don’t understand the hate for this product. 5 years ago one long distance call could cost 40 bucks, it is what it is and worth 100% of its cost.

    • Stanley says:

      The $40 you paid covers the device and the 1st year of service. After that, it is just $19.95/year, less if you pay for 5 years of additional service at one time.

  14. PA Mom says:

    Funnyness,

    IF it works, it’s a great deal. Otherwise it’s a headache/waste of money.

    I have high speed cable internet. I’ve been a PC power user for 20+ years. I can install/replace parts in a PC, wipe hard drives, install/reinstall Windows, etc. When I got the MagicJack, I started with a brand new PC, turned off the firewall, and spent 2 hours on the phone with their tech support trying to tweak both the PC and MagicJack. Couldn’t get the darn thing to work. I can get a satellite dish to work with cable, TiVo, and stream Netflix to through our PS3, but I couldn’t get MagicJack to function.

    It would appear that whoever buys it has a 50/50 shot at getting it to work. If it works, great, you’re one of the 50%. If not, it’s just an aggravating waste of time. For anyone thinking about buying one, make sure you buy it from somewhere that accepts returns and save the receipt.

    • Steve says:

      1. If you check my prior post (two up from yours) one issue can be where you live….if out in the “country” where bad carriers abound it can drive you nuts.

      2. If you can’t return it. Give me a price. Can always use another. Tangoblue netscape.net
      You fill in what’s missing.

  15. Roy says:

    I’ve been using one for over a year, the audio quality was usually poor & people often hung up on me because they couldn’t hear me. Plugging it into a USB hub as recommended didn’t help, although reformatting my PC (using Windows XP SP3) & turning off labor intensive apps while on the phone helped. What really helped (so far at least) was plugging everything into an APC UPS (ES 650) now it finally sounds like a REAL phone without having to turn any apps off while I’m on the phone.

  16. kj says:

    I’ve been using MagicJack for 3 years and couldn’t be happier. Got rid of both my land-line and cell phone which saves about 3000 a year. Especially like the free long distance in North America, as most of my family is north of the border. Quality is great and compares quite favorably to Vonnage and Comcast Voice. However, there is one disadvantage which is not having telephone service when the computer is turned off although voice mail is taking messages. Also, your phone number is unlisted which can be good or bad. When Comcast is sending a weak cable signal (which is quite often) telephone service might not work and you may have to disconnect and reconnect to get it working again.

  17. cdiver says:

    I think this may be a good option for kids vs using cell minutes.

  18. KC says:

    Readers,

    I am a deployed soldier and I use a combination of Magic Jack and skype.. for my uses Majic Jack is perfect as it gives me all the stateside calling i could ask for even on our sketchy sat-link broadband.

    I skype with friends when they are at thier computers and its great too.

    You owe it to yourself to try this product. For 39.95 ofr the Jack and the 1st year even if it doesnt cover all your needs you wont be out more than a movie night for the family.

    I personnally wish this company all the best and am gratefull for the oportunity that it has given me.

    KC
    KOSOVO

  19. Roy says:

    To update my comment back in 05/18, I still have to turn off CPU intensive apps (mainly SETI@Hm, which I let run 24/7) & usually MJ works just fine. Judging from all the comments MJ & Vonage are hit-and-miss propositions, maybe what part of the US you live in affects the quality of service?

  20. Joe Sr says:

    I’ve been using it for a while just recently renewed for another year. Previously I had Vonage, more expensive and service was not that good. I am extremely pleased, no choppy audio on my calls and it is crystal clear at least for my calls. You can’t fax with it but then I couldn’t with Vonage either nor does and other voip carrier support fax. For the money you have to be nuts not to try it for yourself!!!! You even get free conference calling! Try it, you won’t be sorry! I’m Not financially involved in any way either!

  21. PD says:

    I have three Magic Jacks and, while not perfect, I have not had any major problems and you can’t beat the price. I also have Vonage and the Magic Jacks cause fewer problems and as soon as I can port my Vonage number over, I am saying goodbye to them. Vonage has served me well for several years – I live overseas most of the time – but the Magic Jacks are just better.

  22. Michael Imbery says:

    Hi! I love magic jack! Sure I have had a few problems with it! My advice to users who use the magic jack to make money phone soliciting is to make sure you only have your email or maybe one other thing open on your windows. You need to make sure that other people are not using your internet service at the same time you are trying to make calls. I have traveled to many south american countries making a thousand or two thousand a week and seem to live and travel on the beach with my magic jack! It has changed my life, I love living the on the in beautiful countries like Mexico and the Dominican Republic while magic jack helps me fill my pockets full of easy cash!


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