Something just didn’t add up to us. So we looked to the Interweb for research, because as we all know, the Interweb is only filled with 100% accurately researched articles. Anyway, the good folks at Telephony Online, published a snazzy little article back in September 2007 about the way MagicJack earns revenue on their VoIP internet telephone adapter.
Apparently, while one hand created the the VoIP USB telephone adapter “jack,” the other hand created a CLEC. The acronym CLEC stands for Competitive Local Exchange Carrier and is the phone provider (or carrier) for local access numbers. These CLEC’s can charge for access to their numbers as well as lower costs paid to other parties for making or receiving calls. It’s quite the win/win.
MagicJack’s Don Burns explained that SunRocket was paying upwards of $7.00 per month for each phone number they had. By operating as a CLEC, MagicJack’s cost on the same service — zilch.
Talk about pulling a rabbit out of a hat!
