Ooma Telo is here, let the free* calls begin

Ooma might be onto something here. The VoIP provider is taking a different path with the Telo system: the phone calls are free. Like, you don’t ever have to pay for calling your Mom. You can either use your own phones or the Ooma high-end DECT 6.0 handset. Sounds nice, eh? Too bad there’s a huge admission price for the hardware.

The Ooma Telo base station costs $249. That gets you the unlimited calling, caller ID, a new phone number, and access to online call logs. If you want to port your existing number, that costs another $40. The Ooma handset is another $50 too. But wait, there’s more.

Ooma is banking that at least some buyers will opt for the $10 per month Ooma Premier Service that adds on a few extra features. You get one-touch access to voicemail, call screening, remote access to messages, 3-way calling, free 2nd number, backup number, personal blacklist, call forwarding. The Telo comes with a three month trial of the Premier Service, btw.

But when you start to look at the numbers, it makes sense. Vonage is about the only direct competitor to the Ooma anymore (MagicJack doesn’t count, sorry) and it’s least expensive unlimited plan is $25. Let’s say you port your number to Ooma for $40, but don’t buy the branded handset. You only owe Ooma $290 total, where you’re out $25 every month to Vonage and so it only takes you 12 months to recoup your costs with Ooma. Sure, the Vonage system does have more premium features included and now lets you call more than 60 countries with for no additional charge, but there is a one-year agreement that covers the free hardware.

The high price might turn some off to Ooma Telo at first, but my goodness, the numbers don’t lie. It makes sense. The base station should be available at all major electronic outlets now (or real soon) with the handset launching in November.