Yes, it is very budget. Not much in the way of features or speed. But hey, it was a free hand me down, and a big step up from 200 MHz.
Skype is free to use. It offers some pay features, but just don't use them. It's not like it will let you use them anyways unless you've paid. As far as I'm concerned it's just like any other p2p voice chat software out there, except the quality of sound is better (or at least no worse) and it's as easy to use as any instant messenger.