Problem Solvers: MagicJack phone service rates to increase

Problem Solvers
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KANSAS CITY, Mo. --  MagicJack, a low cost telephone service, could soon be raising their rates, according to an e-mail sent by the company to its customers that's caused a lot of concern.

One customer called FOX 4 Problem Solvers to see if the e-mail was real or whether it was spam.

MagicJack's appeal is how cheap the service is.  The company promises you telephone service for as little as $20 a year.  An e-mail sent out to all Magic Jack customers is real.

The e-mail informed customers that their annual fees may be going up, because the company is now going to start billing for 911 services.

Why is MagicJack doing this?  Some state and local governments have been after MagicJack for allowing their customers to use 911 service without paying for those services.

In fact, a county in West Virgina won a case with the Public Service Commission that said MagicJack had to start paying for its 911 service.  That ruling paved the way for other state and local governments to also charge the company for 911 services.

Starting this month, MagicJack is warning its customers that they could see their yeary MagicJack bill increase anywhere from $6 to $60 a year.

Telephone services like MagicJack and Skype have been able to avoid paying a lot of government surcharges that are tacked on to regular phone bills.  But recent events indicate that is changing.  Governments are becoming more aggressive about collecting 911 fees.

One of the reasons is that 911 call centers have been funded by a tax on people's home phones.  But as more and  more people have switched to cell phone service, Skype or MagicJack, the 911 revenue has declined.

Has Missouri or Kansas started to see the extra revenue yet?  Not that FOX 4 News was able to tell.

A Missouri 911 expert told FOX 4 that she's not convinced MagicJack has a billing system in place yet for Missouri users. That's because unlike other states, Missouri's 911 fees vary from county to county and it's not clear that MagicJack has even collected the information it needs from each county to start billing its customers.

FOX 4 tried to contact MagicJack, but we did not receive a response.

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