Computer Guide

Cheap phone calls over the Internet
by George Skarbek 23rd May - 2006

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Q: I have been reading about using my Internet connection to make cheap phone calls to normal phones but there seem to be conflicting reports about what hardware is required. Could you give me a simple explanation of what is needed and is this worth trying?

A: To answer the easy part first - yes, it is certainly worth trying for most users.

Making phone calls to normal phones requires a minimum of hardware at your end. All you need is a microphone and you can use your computer’s existing speakers. Alternatively, you can purchase a small headset consisting of a microphone and ear speaker(s). Most laptops have both built in so no hardware is required. The prices for these headsets start under $10 but can go over $100 but there is very little difference in sound quality between them for Internet use.

The next item that you will need is an account with a provider of the VoIP (Voice over IP) telephony service. You will also need the software to use it but this is free in all cases.

I have installed and used four different SoftPhones. A SoftPhone is software that allows your voice to be transferred as a data stream over the Internet protocol. It is easy to use, has many features and the voice quality is very good. In my opinion the quality was better than calls to mobiles and my friends were unaware that I was talking over the Internet for both local and interstate calls. Overseas quality is just as good in almost all cases.

The four that I tried were: Engin, MyNetFone, Freshtel and naturally, Skype. Skype is by far the largest, but being based in Europe, calls within Australia are treated as overseas calls. It also offers video in addition to voice, whereas the other local vendors are voice only.

Although most VoIP providers have various monthly plans I will give costs for plans that have no minimum monthly costs but require a $10 up-front payment. At the moment, local phone calls cost 10 or 15 cents. National calls (not all of Australia may be covered but cities and large towns are) vary between 2.7 to 10 cents / minute, and Engin has a 15 cents untimed plan.  This means that using Engin you can talk to your friend in, say, Hobart for hours and be charged a total of 15 cents. Calls to mobiles vary between 29 and 35 cents / minute. You can view your account details immediately after the phone call.

In all cases if the other person has a computer, calls to users with the same VoIP provider as your own are free just like e-mail even if they are overseas. However, when speaking computer to computer (eg overseas) you might need to arrange that both are online so that one can call the other.

In estimating your data usage you should allow 1 MB of data for every two minutes of conversation  without using video. Using Skype and a two-way video the data rate is about 4 MB per minute but this depends on the resolution of the webcam used. This data usage with long calls may be a concern if you have a monthly volume limit with your local ISP.

I have found very little variation in quality with all but MyNetFone which refused to keep the Audio Wizard settings. This resulted in the incoming voice sounding like Donald Duck. Despite good tech support, this problem was not resolved and I will wait for a software update. Other reviewers have rated this product highly so obviously success depends on your hardware. Freshtel took the longest time to activate my account – one working day compared to minutes for the others. Two of my clients were able to be operational within minutes using Engin but two suffered from very poor quality problems and required several phone calls over two days to resolve the problems.

Although these services are designed for a broadband service, I conducted a few tests using dial-up. These results were amazingly good. My friends could not tell the difference between dial-up and using my normal phone when using Engin and Freshtel. Skype voice quality was slightly poorer over dial-up and unstable when video was used. However, my conclusion is that even using dial-up you can save a lot of money on phone calls with very little loss in quality.

You can purchase additional hardware such as a “real” phone handset that plugs into the Ethernet port in the broadband router which lets you make and receive calls even while the computer is turned off. However, I have restricted my discussion to the lowest cost entry point. If you make many calls then a plan that costs $6 to $10 per month will result in even lower call charges. To use Engin without monthly charges you must purchase their pre-paid Starter pack for $9.95 from places such as Dick Smith. This includes a CD, earphone and a very cheap microphone plus several hours of free overseas or national calls.

In my opinion, if you ring someone interstate on a regular basis, even once a month, you will save money by using a VoIP solution. To find out if you can use VoIP from your computer click on and choose Sydney as a call destination.

For more information see: or or or   
for Engin, MyNetFone, Freshtel and Skype respectively.

To look at the e-book in PDF format, Computer Guide, based on these columns click here