It's the holiday season and I've got a gift for you - 1¢ per minute calling! If you haven't tried Gizmo Project on your Mac/Win/Linux computer yet, there's no better time - it's easy to use, has the highest quality audio and is now the cheapest for all U.S. calling (of course PC-to-PC calls are free). Wired magazine recently rated it even above Skype as Editor's Choice.

The average caller makes 600 minutes of calls per month which will equate to just $6 at 1¢ a minute. My personal calling habits are probably a little less than that because I prefer email or IM so $10 of Call Out credit (see screenshot) lasts me nearly two months or just $3/month. I rarely use my office phone - I use Gizmo Project instead because it's more convenient once you get numbers in your address book to click and be talking to someone than to manually type in digits and cradle a handset. It felt odd at first talking to the computer,

Account Balance for Gizmo Project

but I quickly got used to it. I typically use a headset or an mVox speakerphone.

One-cent-a-minute calling conjures up crazy Internet schemes of the bubble era where companies were selling $10 bills for $5, but that's not the case this time. This isn't a money losing offer to garner customers and impress venture capitalists. It doesn't end the day after Christmas. This is the new permanent calling rate for all Gizmo Project customers.

Unbelievably, SIPphone, backers of Gizmo Project, is making a profit at 1¢ per minute calls. Our cost is close to 1/2 a cent per minute. What you're witnessing is the march to free calling that I talked about a year ago.

Microsoft is entering the VOIP competition with an underwhelming 2.3¢ per minute offering via MSN Messenger with partner MCI. As always Microsoft is more expensive. Very quickly, Skype has lost its competitive edge - so expect them to adjust their pricing in 2006. For net callers, this means ferocious free market capitalism will drive prices even lower.

In January, watch for Gizmo Project to offer free U.S. telephone numbers. Major VOIP companies today charge $3-$5 per month for a telephone number. But soon every user on the Internet can sign up for a free U.S. telephone number that will ring their computer anywhere in the world. This will put the smackdown on high international calling rates! (NOTE: Priority will be given to existing Gizmo Project users who will be alerted electronically about number availability.) At that time you'll be able to get a phone number for free and pay on average $6/month for U.S. calling. It isn't quite free yet, but it should be a tiny sliver of your current phone bill and mean the stampede to VOIP should accelerate.

Happy Holidays from SIPphone!

-- Michael
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