New Plans Released Following MagicJack and VocalTec Merger

Updated: January 07, 2011

Following MagicJack's merger with VocalTec Communications, a public VoIP firm, MagicJack has announced its decision to market its femtocell product with an unnamed strategic partner. Femtocell is a version of MagicJack designed to work with cell phones, rather than landline phones. Just like the regular MagicJack, femtocell uses internet connections, including broadband, high-speed internent, WiFi, DSL, and cable internet links, to provide unlimited call service within the US and Canada.

While AT&T offers a similar device, it is priced very high – around $200 – and the femtocell would be offered at much more affordable rates. Nothing is known about MagicJack's new strategic partner, beyond the fact that it will be a wireless company.

Dan Frommer, writing on Business Insider, speculates that “the partner could be at the lower end of the U.S. wireless business -- potentially T-Mobile, Sprint, Virgin Mobile, MetroPCS, Cricket, Tracfone, etc.”

MagicJack also plans to come out with a new softphone service, MagicTalk, which will put the new company into direct competition with Skype.

MagicJack also plans to develop several apps for iPhone, iPad, Droid, and BlackBerry, although the company will focus primarily on WiFi and 4G calling. The newly combined company anticipates great business increases as a result of the femtocell release, expecting sales between $110 million and $125 million in the coming year.

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