Why Vongae isn’t a “Great” Deal (at Least for Me)

Okay, the big advertising push that Vonage is making is that you can save up to 50% off your phone bill. While I’m sure that is true for some people it is not going to be true for me. Here is a look at what the first year expense will be and would have been.

Current Phone Company

• $33.00 X 12 for one line, caller id, and call waiting
• $0.00 for long distance (cell phone is used for all of that)

Total for current phone - $396.00
Vonage

• $25.00 X 12 for the same features + unlimited long distance in the U.S.
• -$25.00 for first month free
• $30.00 for set up fee
• $10.00 for shipping and handling
• $1.00 regulatory recovery fee
• $1.00 911 cost recovery

Total for Vonage - $318.00

So I should save about $80.00 over the first year which isn’t bad. However, keep this in mind. If I choose to cancel Vonage after the first month and before a year contract is up then I will have to pay them an additional $40.00 disconnection fee. Also, I would encourage anyone looking at Vonage to keep their current phone plan for at least the first month to see if they are happy with the service. I have a friend who signed up for Vonage but had trouble with their DSL service making it unworkable to keep Vonage. You wouldn’t want to cancel your local phone company, try Vonage out, find it didn’t work for you and have to “re-signup” with the local company. That being the case I have to add another $33.00 into the Vonage plan for the first year. So, realistically I will save $45.00 over the year (under $4.00 a month) if I keep Vonage. If I cancel at the 11 month mark I would save $5.00 as long as my local company didn’t charge me an activation fee.

Am I saying that Vonage is a bad deal? No, not at all. I’m simply suggesting that before you sign up thinking you’ll save 30-50% off your current phone bill you should do the math to find out if it works for you. My guess is I’ll keep Vonage if for no other reason I’ve had no options for a home phone service in the past. Vonage probably wins just because I like to stick it monopolies.