MagicJack femtocell boasts free cellphone service

Looking to cut the cord? MagicJack, the device that promises dirt cheap long-distance calls by creating a way to hookup landline phones into Internet-connected computers, is set to release an updated femtocell gizmo that will do the same trick for cellphones, conserving costly monthly minutes.

The Florida-based magicJack crew unveiled the new gadget, nicknamed the "femtojack" by technophiles, at the International Consumer Electronics Show in Las Vegas earlier this month.

The company charges $40 for the magicJack and includes one free year of service, then charges $20 per year for subsequent years. That covers calls to other magicJack users as well as to conventional phones. The pricing will remain the same for the new femtocell.

While cost-conscious consumers are jumping for joy, the news is raising a few eyebrows in the telecommunications world. The device piggybacks on the radio frequencies that wireless service providers pay billions to use.

A femtocell, sometimes called a “home base station” or “small cellular base station,” is a telecommunications term describing a "wireless landline" hub used in small business that connects a service provider’s network (such as cable or DSL) with two to five cellular phones ideal for residential or small-office environments.

Operating the card-sized device is simple, but has limitations. Consumers register their cellphone number one time with magicJack after plugging the device into the USB terminal on their computer. To tap into the subscription-based service, cellphone users must be within eight feet of the magicJack.

This home-only caveat is how the "femtojack" is able to avoid potential legal scrutiny. MagicJack plugs into the wireless spectrum legally because licenses don't extend into the home.

Click here for the lowdown.

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