I've never heard this term before, but Martin says "Leaky PBX" was a term from the mid 90s that applied to PBX systems that did toll-bypass through "back door" means - as a result they were shut down. He says ooma is doing essentially the same thing and adds:
Neat trick! But will it fly? Honestly, I fully expect lawsuits to fly here. Ooma is clearly violating the intent of the law here…as well as engaging oblivious users to violate their agreements with the local phone companies (RBOCs) and engage in unlicensed long distance termination. Honestly, knowing how the RBOCs legal strategies work, I expect them to jump on this hard….after waiting to see if Ooma makes any impact at all.
Indeed. That last point is a key one. The phone companies are not going to waste a lot of time and money on ooma, if they don't end up being much of a player, and simply fade into oblivion on their own.