“Iowa based AllFreeCalls is letting people make phone calls to many foreign countries for free. Or rather, for the cost of a call to Iowa. You call the AllFreeCalls phone number, which is 712-858-8094, and at the prompt dial 011, the country code you are calling and the number you wish to call. The call is made at no charge to the user. A list of supported countries and prefixes is here, and the company says they are adding ten more countries in the coming weeks.

Here’s my understanding of how this works: the founder created his own telephone company in Iowa. Iowa is apparently the only state taking advantage of an FCC kickback scheme that gives telco’s a portion of the fees generated from every inbound call to an Iowa number. So when you call the AllFreeCalls phone number, a portion of any long distance fees you are paying go to the company. The kickback is apparently authorized via the Universal Service Fund. These kickbacks are enough on average to more than cover the international outbound calling fees.”

– Via TechCrunch