The biggest issue I had was a "you can hear me, but I can't hear you" issue. About three months in, the Magic Jack would ring, I could answer, the person on the other end could hear me, but I couldn't hear them. It was an inconsistent technical issue, that would happen from time to time. I reinstalled the software, tried a different phone, but it would still happen from time to time. About a month later, the problem went away... from what I could tell it wasn't because I fixed it, it seemed to have fixed itself.
Some of the other issues are mainly annoyances. Remember that your computer has to be on, and connected to the Internet for the Magic Jack to work. When you boot up your computer, the Magic Jack window will pop up and stay in front of anything else until it is completely ready to go. Sometimes, this takes a couple of minutes and can be very annoying when you are just wanting to check email or post a blog, or log into Club Penguin, but have to wait until that darn screen goes away. Perhaps the most annoying thing is that the Magic Jack logo that pops up tells you to be patient.
The caller id option did not work on my cheap cordless phone (but, I've seen that it does work on other cordless phones.) It also is hit and miss with the answering machine that is built into the cordless phone. I love the fact that if someone leaves me a message on the Magic Jack voice mail, it gets sent to me via email. However, there are times when the Magic Jack voice mail doesn't pick up fast enough (supposed to after 4 rings) and it rolls over to my answering machine. Again, not a big deal, but can be a bit annoying.
I'm not a big phone talker, but I now have one teenage daughter, and two more waiting in the wings. They've been pretty good about using the Magic Jack to talk to their friends during the day (I'm on Sprint now, so my 'nights and weekends' begin at 7:00 PM.) So, it has kept me under my 1,500 shared monthly minute plan (which any of you with teenagers know that can be eaten up in no time at all!!)
I joked last year about running Magic Jack off of a 3G connection. Well, that's no longer a joke. If you have a netbook or 3G card enabled computer, you can run Magic Jack off that connection. I'm still too cheap, however, to buy a 1968 Dodge Dart so I can pretend I'm Mannix. They've also expanded to run the software off of Macs (Intel processor), and I just discovered that they have a Magic Jack Conference Calling option (available for anyone, not just Magic Jack users.)
So, one year into the experiment of can I continue to live without a land line, and still keep my cell phone bills under control, I'd say that it has been a pretty good experience so far. I'll let you know if five years if I'm still using Magic Jack or I've found that 1968 Dodge Dart.