Magic Jack hits the magic 100 million
On March the 12th 2007 I wrote that Magic Jack would be a winner.
A couple of days later they sent me the device
Now we hear that Magic Jack will hit $100 million turnover this year.
“The company is selling about 9,000 to 10,000 MagicJacks a day, according to Borislow, and customers are using about 500 million minutes a month. The company will do more than $100 million in sales this year, Borislow says, and is cash-flow positive”
I had a chat a few years ago with the founder Dan Borislow and told him how I loved the product, Dan has had a very successful business career and is one of the most unassuming guys I have met.
Whats MagicJack?
its a USB stick that you plug into your PC/laptop and plug a normal household telephone into the other end, it gives you a USA number and you get to make and recieve calls to all USA numbers for zero cost in year one and $19.95 in year two
So how does MagicJack do this?
its really quite simple
As a CLEC MagicJack gets USA numbers for pretty much free, all telco’s that call this number must pay MagicJack a fee for “landing” on its network, so its pretty much telecoms arbitrage, if in evens with out the profit is 100% on the yearly fee, add on the profit from the device and you have a very successful business model.
So who are the MagicJack customers?
Travelers, people overseas with relatives in the USA is a huge portion of this business as you can imagine and people with no landline
The bad news
A huge amount of complaints in forums plus a certain amount of jealousy from telecoms quarters feeling that the sales model of MagicJack (late night infomercials) is cheap and tacky.
Me
I’m a huge fan, simple device, does what it says on the box
Sells millions.
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MagicJack is a scam. A rip-off blinded by positive cash flow.
They can’t deliver what they promise and won’t be able to pay their bills to termination provider once the market will be saturated.
As you can understand I don’t like the idea, the company and its product.
I have to admit I don’t understand the attraction, this is VoIP with a USB/RJ11 connector. Skype with a dongle. The profit is from the OCB (originating Carrier Billing) surcharge which only exists in the U.S.?
ooma is the best. Free in US.
Love the Magic Jack and a Big Fan also.
BTW found a Coupon on eBay for $10.00 off MJ. Goto eBay and search for “Magic Jack Coupon”. It’s was great to way to save even more money when I bought my 2nd MJ.
Since a PC is req, I would have thought call termination would be minimal. In an interview Ooma had argued that it costs them around $20 per year to handle call originations. I think this is the secret of MJ as well.
This is the reason I am waiting for any day MJ to announce a partnership with a cordless phone manufacturer of a device with MJ built-in. This would most certainly increase MJ’s termination revenue.
Honestly? I wouldn’t have given them a cent. Happy I was wrong. I would be interested to have a look at their balance sheet, though…
Surprised by this, I thought Skype and the likes would of rendered this business obselete
Can I plug my fax machine into it?
i installed the magic jack on my computer last fall 08,i use a brother fax machine model 560 that i purchased in 2002 quite often with the magic jack and have never had any problem ever,i am very happy with the magic jack,the most time you will ever have to put into it is the set up,which after i read the directions,only took a short time,i had “MCI” and was paying 80.00 a months 29.95 plan with 200 free local distance minutes,additional line for my fax machine and surcharges and fees that i swear added up to 30 dollars,i fell behind on my bills due to medical issues and had to disconnect my phone and live off my cell phone,i was very hesitated about the magic jack,thinking like others it was too good to be true,but i gave it a try,and i am so grateful,that a person took the time to develop and create the technology,and many people i know,that have it,still have traditional phone service,and used the magic jack for like a 2ND line,i just convinced my father to get it last Monday,he bought it at a local retailer,he installed it himself,and he is so happy ,he is 81 on a fixed income and no longer has to pay Verizon’s 12 cents a minute to call his sister long distance,i truly believe the phone companies have been overcharging us for years, and it does not cost that much money for the upkeep of these phone lines,no matter what you do,there will always be people who complain,but i think if you follow the directions,the magic jack will work fine,i do experience the occasional beep like another poster complained about,but if that is the worse thing i have to experience to save the money magic jack is saving me,it is well worth it,also when i first got it i tried to plug the magic jack into the usb port on my monitor,but it did not work,when i plugged the magic jack into the usb port on the front of my computer tower i was in business…..
also i wanted to mention that magic jack’s customer service does exist but it is done over the computer you talk to a live operator through the Internet , i had to use there customer service 2 times since i had the unit and the person i was typing to was very helpful and solved my problems,and honestly they person seemed like they really cared,and i do not work for magicjack,but i am very happy this product exist,my only regret is i did not get it sooner,if i had another usb port on my computer(my computer is a dell that i bought in 2001) i would get one just for my fax machine,does anyone know when the first magic jack was available for consumers,when i bought it is was only available to order on there website or late night info commercials,now it is sold everywhere,like i stated in my previous post,my dad got his at wal mart…..
we’ve been using a Magic Jack for a couple of years and pretty happy with it.
You can now buy them at Walmart and Best Buy here in the US, but we gout ours when it was just random internet sales.
Their site sucks beyond belief and the lack of email/forum based customer support sucks but the live support is actually pretty good when you get through.
Much better call quality than our previous Skype setup (both wired to the PC or using a Belkin handset) though I’d love to see a DECT handset that works with this so we can manage a phone book and expose it on the handset(s)
Finding rates is as complicated as any other internet Telco… would love to see an option to enter the number you want to dial somewhere on their site and get a simple $/min price rather than work out what carrier in the UK I’m calling!
Some call quality issues… dailing in the US is rock solid, but calling the UK and AU sometimes has quite a few failures trying to connect (and you get charged for the first minute even though you don’t get through)
Best feature…. sent one to my brother in the UK and now have free calls to him MJ to MJ
I think Magic Jack still has the problem with ringer. I just bought a Magic Jack. Have tried all options but i cant get a ring when I call a MJ #. Although the call goes through, it doesnt ring. That is a limitation with Magic Jack.
There is a reseller that gives good service. The product is good and of course it doesn’t work for all 100% but no product is perfect….
I can send faxes but cannot receive them on a brother 770. is there something I’m supposed to do about the baud rate? How is that done?
I’m using magic jack. i can send faxes but cannot receive them. how do I change the baud rate?
Let’s be honest–I re-signed for a 5 year renewal license because I LIVE on my computer, use my telephone very infrequently and loathe paying for a service that I seldom use. However, you DO get what you pay for and MagicJack has many, many annoying issues. Chief among these, is its tendency to take over (and generally MESS UP) your configurations after one of its frequent updates. And woe-woe-WOE-be-unto-you if you should need to “rely upon the kindness of (those) Customer ‘Support’ strangers” in MagicJack-neverland (!) It can get…very ugly, very quickly. Not only should you expect to spend a MINIMUM of 30 minutes phone time, even after your call has been escalated to a supervisor; but these supervisory techs are a bit on the arrogant side as they fail to fix your MJ issues. In the end, I find that I repair these glitches myself…just in time for the next Magicjack update (she adds dryly)
If Magic Jack can send our voice mail messages in internet, there is a good chance to send a fax transmission directly to the internet without using a fax machine.
Magic Jack has an unlimited potential to tap the market.
Call quality is the pits. There is no quality of s.ervice so you just keep saying “would you repeat that I could not hear you.”
The old adage you get what you pay for really holds to reality here
I’ve been using Magic Jack for a year or so and it is the best bang for the buck product I think I’ve ever purchased. I think people that have issues have slow internet upload speeds. Just like with my Vonage I had issues until I got 500kb upload. I had 3Mb down and 256kb upload with issues. Once my service was increased to 3Mb down and 512kb upload most problems went away with my Vonage and ALL problems went away with MagicJack. I’ve now cancelled my Vongage and love the Magic Jack. Also, I do have an old PC running as a media server in my home and MagicJack is plugged into it so I don’t have to have the anoying MagicJack softphone pop up every time a phone is used in the house. I have one cordless phone base unit plugged into the MagicJack with 5 handsets throughout the house and nobody would ever know it isn’t a landline. A free phone number, voicemail to email, call forwarding, caller ID…and more for 20 bucks a year and it just works. I love this thing. I have my internet router, PC, and phone plugged into a UPS system so internet and the PC stays up short power outages so no disruption of calls if the power blinks.
just curious.. Since MJ makes their money from people calling you.. if your usage was heavily unbalanced with a high percentage of your totals call being outbound would they lower your quality to get you to quit using it and keep quality high on those that have high percentage inbound?
i pretty happy after using majick because it feels like we are using a landline phone . and its very cheap to .
Thanks
THE MAGIC JACK IS A SHAM AND A PIECE OF JUNK
IVE HAD 2 THIS IS MY SECOND ONE…
I CAN MAKE CALLS AND THE PERSON I CALL HEARS ME BUT I CANT HEAR THEM…. YOU WOULD HAVE THOUGHT THAT AFTER THEIR INITIAL HONEYMOON THE COMPANY AND OWNER/ORIGINATOR OF THIS SO CALLED DEVICE WOULD HAVE TRIED TO MAKE IT WORK, ITS THE SAME AS THE FIRST TIME ONLY WORSE….
SHAME ON YOU DAN FOR ATTEMPTING TO DECIEVE PEOPLE WITH THIS PIECE OF BOGUS TECHNOLOGY
i love the magicjack
i also love the magicjack