I've tried Skype, though I haven't used it in a couple of years. They're both softphones, though, of course, you have to pay for Skype by the minute if you're dialing to a telephone.

The magicJack interface is far more "phone like" than Skype, has a hold button (and there's music on a hold), voice mail (automatically forwarded to email), etc.

The magicJack audio quality is, IMHO, far superior to Skype. With Skype I had continual problems with delays, echoes, etc. MagicJack sounds better than my landline phone.

On the other hand, though the magicJack interface is simpler, getting it to work well takes a little bit of work. For example, performance improves with the TJ echo canceling software, which takes some ingenuity to find. QOS settings, both for the local computer and the LAN make a big difference. I've found using a hardware-based QOS prioritizer helps, as well. Finally, magicJack support is just terrible -- imagine the worst of an Indian help desk confined to internet chat.