Wednesday, August 4, 2010

How to Make Free Phone Calls From Your PC

Anyone who has followed some of my posts on the Internet knows I hold a dim view of the long term prospects for the country's major communication companies like AT&T and Verizon.  The reason is quite simple--- they are technology companies, not regulated communications utilities anymore, and anyone who doesn't recognize this is in for a continued decline in the value of their investment.  As speeds continue to increase on the Internet as a whole and cell phones continue to develop a richer feature set, these technology along will render the "cash-cow" copper line business obsolete, and take a large bite out of the revenue steam of these companies that they will have difficulty replacing.

To illustrate my point, I am going to demonstrate how to set up your PC to make free Internet based phone calls.  The only equipment you will need to pull this off is a high-speed Internet connection, a fairly modern PC, a headset with microphone and a router.  We will use Google Voice in combination with Sipgate to make the connections into the existing telephone network.  To keep costs down even further we are going to configure this on a Linux operating system with free software components.

Step 1: Establish a Google Voice Account

Go to website, set up an account and acquire a Google Voice phone number.  Google Voice can perform two main tasks: 1) provide a single phone number that can be used to forward calls to other devices such as home phone # or cell phone #, and 2) allows you to make toll free calls anywhere in the US.

Step 2: Establish a Sipgate Account

Go to website and set a free single number account that will allow you to make VoIP calls from your PC.  Their number bank is limited as of this writing and California numbers may be all that is available.

Step 3: Set up your softphone on your PC

On Linux download the Ekiga package and configure the phone.  In my case go to the Edit->Accounts option and set up an account for Sipgate.  For those who run Windows, Sipgate has a softphone on their website that can be downloaded.

The values for fields User, Authentication User and Password come from your Account on the Sipgate website under Settings->Sip Credentials.

Step 4. Launch your softphone.

Start Ekiga and it should connect to Sipgate.

Step 5. Configure Google Voice to connect to your Sipgate softphone.

Log into your Google Voice account and forward your Google Voice account to your Sipgate account phone number.

Step 6.  Download the Google Chrome browser and the Google Voice add on component.

If you have done this correctly, your Chrome browser should have a blue phone in the upper right corner that can be used to control Google Voice.

Step 7.  Make your first call.

In the Google Voice window above, type in the number to call and hit connect.  Google Voice will then call your Sipgate phone.  Ekiga will issue the following prompt.

Click accept, then Google Voice will be connected to your softphone as it initiates an outbound call to number you wish to contact.  After a few seconds, you will hear the ring of the other number being called.  This is the trick that makes this technique free-- Sipgate only charges for outbound calls initiated from the softphone; Google Voice looks like an inbound call, even though it subsequently makes the other side of the connection.  Google Voice can also be used to bypass toll charges on your traditional land line.

Step 8: Configure your Router for Quality of Server

Assuming you have a router with QoS capabilities, make the sip protocol a premium service so it will get the required bandwidth necessary to give you a satisfactory voice experience.  On my router running DD-WRT, the config looks like:

If a hack like me can figure this out, imagine what the future holds with a bunch of genius teenagers thinking outside the box.  In theory you could replace your landline with this set-up, saving yourself $600-$1200 a year.  Both Google Voice and Sipgate feature voice mail and caller id for free, and can forward calls to any phone of your choosing at no charge.  This is why I am pessimistic on the long term outlook for phone companies in particular, and believe that cable companies are vulnerable too.


  1. Nice work on this post. It makes me think of a client of mine who owns Telus stock. I suggested that it was capital intensive, and facing a tougher environment going forward, with communications revenue drying up. It has to branch (as it is) into areas that might not be in line with its core competence.

    Great instructions that you gave as well!



  2. It looks to me like this is a consulting opportunity for you. From my perspective, despite your excellent instructions, it is beyond my technology know how.

  3. Hi Andrew,

    If you're talking Telus, you must be Canadian.

    I recently retired from one of the large US Telecom companies and have some insight into their issues. The wireline business is in steady decline and every Telecom company is in a race to figure out how to replace those lost revenues. Cell phone growth has been filling the gap so far, but that is slowing down. You may have seen the Verizon-Google deal this morning concerning selling guaranteed band-width. These telecom companies are going to truly have to reinvent themselves and get into many new markets if they are going to show any top line growth.


  4. Hi Robert,

    The instructions might be a little hard to follow, but you could start by getting a Google Voice account to give out to your contacts. It has voice mail, call forwarding and caller id already built in. You could forward that number to your work phone, home phone, or cell phone depending on where you are, or elect not to forward and send straight to voice mail. You can also use Google Voice to make free toll calls from your land lines..... that feature alone is worth something.

  5. I am Canadian. But I live in Singapore and I'm married to an American, so I'm really all over the map.

    It makes a lot of sense what you say about the telecom industry. I've been doing financial consulting for the past decade or so, and this woman I'm referring to used to work for Telus. That's where her pension comes from, and that's the stock she seems to like best. It makes me nervous, considering the lack of a "durable competitive advantage", and the uncertainty and capital intensiveness of the business---not to mention the greater fears of replacing revenue going forward. It's going to be interesting.

  6. Hi Andrew,

    I'm a Verizon retiree. Worked there for close to 30 years. After US 401k law was changed in response to Enron and Worldcom, I immediately cashed in my VZ stock and moved it to an index fund. I'd say the phone companies lost their durable competitive advantage in the late 1990's, early 2000's. I've heard on of the more astute VZ execs comment that there is a Moore's law for telecommunications (like with CPUs)--- that bandwidth doubles and price decreases by half every two years.... those are tough economics to fight against. Sooner or later, the Internet will both the phone and cable TV networks... it is just a matter of time.

  7. VoIP or Voice over Internet Protocol is becoming increasingly popular with internet users. VoIP allows you to make phone calls from your PC to another PC or from PC to a conventional landline or a mobile telephone. The phone calls from PC to PC are invariably free, while calls from PC to regular phones may attract charges, but still much cheaper than regular phone calls.0800