Ooma was founded by Andrew Frame, formerly of Cisco Systems. Originally, the company used peer-to-peer technology for a VOIP phone system, which worked via the Ooma Hub and connected to other Ooma clients landline phones. This system was discontinued in 2008, with Ooma phones now strictly using the internet for phone service.
In 2008, the company released its Telo system, which consisted of a base system to access unlimited calling and caller ID. In 2009, Ooma was awarded an Internet Telephony product of the year award for its development of Ooma Telo and the Ooma Telo phone.
In November 2012, the company released a new handset which included one-touch voicemail, intercom service, as well as a baby monitor.
In June 2014, the company gave every person in West Valley City, Utah, free VOIP service for those with fiber optic systems. In 2015, the company was named one of the fastest growing companies in the San Francisco Business Times.
Today, Butterfleye is the security division of Ooma. The company offers a series of wireless streaming cameras, door and window sensors, along with audio, which recognizes sounds such as breaking glass or crying and notifies users. The company also offers water sensors, motions sensors and garage door sensors.