Posted by: mikepearsonnz | May 9, 2010

Is it time to ditch your phone line?

SkypeDo you really need your phone line?

I haven’t had a landline for over 2 years.  I use Skype over broadband for my telecommunication needs.  I have what looks like a Wellington (04) phone number, but its actually a SkypeIn number, which connects you to my Skype phone.  Here’s what I currently pay:

Skype, $7 per month + TelstraClear broadband, $55 per month

  • Landline: Unlimited calling (subject to a fair usage limit)
  • Mobiles: 29c per minute
  • 10Gb traffic

That’s pretty amazing, when you think that a standard phone line costs almost as much.

Telecom Homeline pay $38 – $46 per month, plus extras depending upon their  plan

  • Landline: 18c – 45c per minute
  • Telecom mobiles:  38c – 62c per minute
  • Non-telecom mobiles: 47c – 62c per minute
  • No internet

Most people I know are still using a landline PLUS broadband.  Therefore their costs are more likely to be:

Telecom Total Home, $99 per month

  • Landline: Unlimited calling  for up to 2 hours per call (then $0.14c per minute after that)
  • Telecom mobiles: $2.00 for up to 2 hours per call (then $0.29 per minute after that), or standard rate of $0.29 per minute
  • Non-Telecom mobiles: 37c per minute
  • 10Gb traffic

TelstraClear HomePlan, $105 per month

  • Landline: Unlimited calling  for up to 3 hours per call
  • Mobiles: 40c per minute
  • 10Gb traffic

Its not something that your telecommunications provider will discuss with you, but ditching your phone line could save you over $500+ a year.    The savings for business could be even more, since they are also charged for local calls.  You can reallocate this money towards better broadband, an iPhone, or other productivity enhancing tools.

I suggest you use Skype first before ditching your phone line.   There are a lot of factors that can affect whether you have a satisfactory experience, ranging from broadband speed, computer configuration to hardware quality.  Here are some tips to get you going.

Most people associate using Skype with a microphone and/or web camera on their PC.  Make sure you use the best hardware you can afford.  The free headset or webcam included in your PC bundle is probably not the best.  At a minimum, you need a good headset, like the Logitech Premium USB Headset 350.  If you want to videoconference, then I recommend the Logitech Quickcam Pro 9000.  In business situations requiring good audio, perhaps with a group of people talking, the Clearone Chat 50.

I’ve found that call quality can be variable, depending upon your computer setup / whatever else is running on your computer at the time.  There are many more convenient ways to use Skype, that solve this problem.

Our main Skype device in the home is a Linksys CIT400 iPhone (yes really, Linksys were the first to register the term iPhone).  It doesn’t need a PC to operate, you just plug it directly into a spare port on your broadband device.

More and more these days, I find myself using the free Skype  iPhone app.   We have poor Vodafone coverage at Paraparaumu Beach, but I can use Skype on my iPhone, which connects through my WiFi, to give great phone call quality.  For my purposes, it makes Vodafone’s femtocell solution obsolete, before they have even started marketing it.  Skype for iPhone would be even more useful, if it could be used away from home on 3G.  Unfortunately Apple/telcos have chose to not permit this.

Skype - no emergencies

Important note: Skype can’t be used for emergency 111 calling, therefore you need access to an alternative way to call emergency services, such as a cellphone.



  1. Great idea and thanks for posting this info. Question though: how do you get a normal phone number associated that people can call you on?

    • Hi Ron, its called a SkypeIn number, and it gives you a normal phone number that people can call you on. In New Zealand, if you see a phone number with first 3 digits 889, then its a SkypeIn number, e.g. (04) 889-9999. Skype has numbers for (03), (09), (04) .

      The thing that people have to get their heads around, is that I could have an Auckland SkypeIn number (09) 889-9999, but I live in Wellington. Similarly I could have a Sydney, Australia SkypeIn number, so anyone in Sydney could make a local call to me.

      You can read more about SkypeIn numbers here:

  2. Hi Mike, thanks for that info on SkypeIn. It certainly got me interested. I see that Slingshot offer a unlimited full speed broadband-only deal for about $75, which includes i-Talk. Not bad. Need to figure out how to hook up or replace the existing phones.


    • Thanks Ron. Since my posting, Skype has now opened up iPhone Skype calling over 3G. That has big implications for the business models of telco providers, and it will be interesting to see how they respond.

  3. Finally got around to going VOIP and it works a treat. I’m using a LinkSys ATA SPA2102 router that hooks up my existing analogue wireless phones. Install was a bit of guesswork as the router has pages of configuration screens, but in the end it was a only a couple of settings to enter the user ID (phone number) and password. Quality is great. I’m using the Slingshot naked broadband deal with a basic iTalk plan.

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