UNITED STATES SECURITIES AND EXCHANGE
COMMISSION Washington, D.C. 20549  Form
10-Q  xQUARTERLY REPORT PURSUANT TO SECTION
13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 for the quarterly period ended September 30,
2008  oTRANSITION REPORT PURSUANT TO SECTION
13 OR 15(D) OF THE SECURITIES EXCHANGE ACT OF 1934 For the transition period from
       to   Commission File
Number 000-304799eTELCHARGE.COM(Exact name of registrant as
specified in its charter)NEVADA

75-2847699(State or other jurisdiction
ofincorporation or organization

(I.R.S. EmployerIdentification
No.)1636 N. HAMPTONSUITE 270,
DESOTO, TEXAS

75115(Address of principal executive
offices)

(zip code)972-298-3800(Registrants telephone number,
including area code)  Indicate by check mark whether the
registrant (1) has filed all reports required to be filed by Section 13 or 15(d)
of the Securities Exchange Act of 1934 during the preceding 12 months (or for
such shorter period that the registrant was required to file such reports), and
(2) has been subject to such filing requirements for the past 90 days.
 xYesoNo  Indicate by check mark whether the
registrant is a large accelerated filer, an accelerated filer, a non-accelerated
filer, or a smaller reporting company. See the definitions of large accelerated
filer, accelerated filer and smaller reporting company in Rule 12b-2 of the
Exchange Act. Large
accelerated filer o Accelerated
filer o Non-accelerated
filer o
(Do not check if a smaller reporting
company) Smaller
reporting company  x  Indicate by check mark whether the
registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).
 oYesxNo  As of November 4, 2008, there were 310,880,878
outstanding shares.  1  PART I 
FINANCIAL INFORMATION  Item 1. Financial Statements  eTELCHARGE.COM(A Development
Stage Company)BALANCE SHEETSSeptember 30,
2008(unaudited)

December 31,
2007(audited)ASSETSCurrent assets:Cash

$
15,923
$
230,227Interest receivable

3,668

1,425Prepaid expenses and other current assets

23,878

24,444Total current assets

43,469

256,096Fixed assets, net of accumulated depreciation of
$10,164        and $4,551,
respectively

23,348

25,970Deferred financing costs

23,440

28,469Deposits


1,980

1,980Total assets
$
92,237
$
312,515LIABILITIES AND STOCKHOLDERS' DEFICITCurrent liabilities:Accrued expenses
$
227,197
$
139,732Payroll tax obligation

40,287

112,610Accounts payable

599,761

53,598Derivative liability

87,593

144,643Current portion of notes payable

19,170

4,217Total current liabilities

974,008

454,800Long-term liabilities:7.75% Convertible debenture, net of discount of
$135,625      and $144,642,
respectively

204,375

55,358Notes payable

3,766

6,042Total liabilities

1,182,149

516,200Commitments and contingenciesStockholders' deficit:Common stock, $0.003 par value, 400,000,000 shares
authorized,      310,880,878  and
282,087,602 issued and outstanding, respectively

932,642

846,262Common stock issuable, $0.003 par value 4,000,000
shares

20,000

-Additional paid-in capital

15,441,730

14,620,417Deficit accumulated during the development
stage

(17,484,284)

(15,670,364)Total stockholders' deficit

(1,089,912)

(203,685)Total liabilities and stockholders' deficit
$
92,237
$
312,515  See accompanying notes to the financial
statements  F1   eTELCHARGE.COM(A Development
Stage Company)STATEMENTS OF OPERATIONS(Unaudited)Three months endedSeptember 30,

Nine months endedSeptember 30,

June 7, 1999(Inception)
toSeptember 30,2008

2007

2008

2007

2008Revenues
$
9,997
$
11,116
$
36,887
$
29,768
$
134,999Operating expenses

762,953

926,878

1,814,875

1,582,221

17,220,330Net loss from operations

(752,956)

(915,762)

(1,777,988)

(1,552,453)

(17,085,331)Other income

-

-

-

-

61,826Gain (Loss) on extinguishment of
    debt, net

-

52,472

-

(590,283)

(293,620)Interest expense, net

(15,213)

(8,250)

(35,931)

(23,872)

(167,159)Net loss
$
(768,169)
$
(871,540)
$
(1,813,919)
$
(2,166,608)
$
(17,484,284)Basic and diluted net loss
    per share
$
(0.00)
$
(0.00)
$
(0.01)
$
(0.01)Weighted average shares
    outstanding

304,561,443

230,232,546

295,600,790

198,181,874  See accompanying notes to the financial
statements  F2   eTELCHARGE.COM(A Development
Stage Company)STATEMENTS OF CASH FLOWS(Unaudited)Nine months endedSeptember
30,

June 7, 1999(Inception)
toSeptember 30,2008

2007

2008CASH FLOWS FROM OPERATING ACTIVITIES:Net loss
$
(1,813,919)
$
(2,166,608)
$
(17,384,283)Adjustments to reconcile net loss to net
cash used in operating activitiesAmortization and depreciation

19,660

2,410

137,505Issuance of common stock for services

395,777

1,259,077

9,766,546Issuance of stock options for services

147,502

-

873,752Mark derivative instrument to market

(81,173)

-

(81,173)Imputed interest

-

19,304

63,036Loss on extinguishment of debt

-

590,282

293,620Changes in:Interest receivable

(2,243)

-

(3,668)Prepaid expenses and other current assets

16,199

(17,777)

(10,225)Accounts payable

546,163

4,883

652,232Accrued expenses

180,900

122,473

2,986,706Payroll tax obligation

(72,323)

(108,667)

40,288Net cash used in operating activities

(663,457)

(294,623)

(2,765,664)CASH FLOWS FROM INVESTING ACTIVITIESCapital lease obligation

-

-

8,911Disposal of property and equipment

-

-

867Purchase of property and equipment

(2,991)

(13,765)

(79,873)Net cash used in investing activities

(2,991)

(13,765)

(70,095)CASH FLOWS FROM FINANCING ACTIVITIES:Proceeds from sales of common stock

205,100

352,485

2,101,283Proceeds from convertible note payable (net of
offering costs)
-
-

171,531Net loan proceeds from shareholder

250,000

(14,712)

587,752Proceeds from note payable  other

-

-

153,233Payments on notes payable-other

(2,956)

(947)

(45,617)Payment on note payable to related party for asset
purchase
-

-

(116,500)Net cash provided by financing activities

452,144

336,826

2,851,682NET CHANGE  IN CASH

(214,304)

28,438

15,923,CASH, beginning of period

230,227

1,672

-CASH, end of period
$
15,923
$
30,110
$
15,923  See accompanying notes to the financial
statements  F3   Nine months endedSeptember
30,

June 7, 1999(Inception)
toSeptember 30,2008

2007

2008Supplemental schedule of non-cash financing
activities:Issuance of common stock in exchange
for  receivable from shareholder
$
-
$
-
$
1,000Issuance of common stock for retirement of
debt

-

150,313Increase (decrease) in Derivative liability

(81,173)

-

63,470Issuance of payable to related party in
exchange  for proprietary rights

-

-

116,500Property and equipment acquired
through  issuance of common stock

-

-

21,595Issuance of common stock for accrued
expenses

93,435

7,150

3,960,536Issuance of common stock for pending
stock  subscriptions

-

-

153,220Stock issued for conversion of debenture

110,000

-

110,000Note payable issued for purchase of
insurance

15,633

-

15,633Supplemental cash flow disclosures:Cash paid for interest

92,248

3,650

146,725  See accompanying notes to the financial
statements  F4  eTELCHARGE.COM (A Development Stage Company) NOTES TO FINANCIAL STATEMENTS  NOTE 1 - HISTORY AND ORGANIZATION AND SUMMARY OF
SIGNIFICANT ACCOUNTING POLICIES  eTelcharge.com (eTelcharge or the Company) was
incorporated in Nevada on June 7, 1999. eTelcharge was formed for the purpose of
providing an internet credit option for online shoppers to charge items sold
over the Internet to their telephone bill. As of September 30, 2008, eTelcharge
has not commenced significant operations. eTelcharge is in the process of
raising financing to fund future operations and marketing of its product to
target customers. As such, eTelcharge is considered to be in the development
stage.  Basis of Presentation  The accompanying unaudited interim financial statements
of eTelcharge have been prepared in accordance with accounting principles
generally accepted in the United States of America and the rules of the
Securities and Exchange Commission, and should be read in conjunction with the
audited financial statements and notes thereto contained in eTelcharges most
recent Annual Report filed with the SEC on Form 10-KSB.  In the opinion of
management, all adjustments, consisting of normal recurring adjustments,
necessary for a fair presentation of financial position and the results of
operations for the interim periods presented have been reflected herein.
 The results of operations for interim periods are not necessarily
indicative of the results to be expected for the full year.  Notes to the
financial statements that would substantially duplicate the disclosure contained
in the audited financial statements for 2007 as reported in the 10-KSB have been
omitted.  NOTE 2 - GOING CONCERN  As shown in the accompanying financial statements,
eTelcharge incurred a net loss of $1,813,919 for the nine months ended September
30, 2008, has an accumulated deficit of $17,484,284 and a working capital
deficit of $930,539.  These conditions raise substantial doubt as to
eTelcharge's ability to continue as a going concern.  Management is trying
to raise additional capital through financing and further development and
marketing of its products and services in order to generate revenue.  The
financial statements do not include any adjustments that might be necessary if
eTelcharge is unable to continue as a going concern.    NOTE 3 - PROPERTY AND EQUIPMENT  Property and equipment consisted of the following at
September 30, 2008:  Description

Life

AmountComputer equipment

3-5 years
$
29,430Office furniture and equipment

5 years

4,08233,512Less: accumulated depreciation



(10,164)$
23,348  Depreciation expense is recorded using the straight-line
method and totaled $5,613 and $2,410 for the nine months ended September 30,
2008 and 2007, respectively.  NOTE 4 - ACCRUED COMPENSATION  During the nine months ended September 30, 2008,
eTelcharge issued 9,596,077 shares of common stock valued at $489,213 to
employees and consultants for services rendered.  Of the total amount
issued, $395,778 was for current period services and $93,435 was for services
performed in prior periods and was accrued at December 31, 2007.  As of September 30, 2008, the Company accrued $186,606
payable in cash and $16,699 payable in 1,192,500 shares of common stock for
compensation for services rendered to the Company.  F5  NOTE 5 - PAYROLL TAX
OBLIGATION During 2007, the Company remitted previously unpaid
Federal and State employer and employee payroll taxes for the years 2001 through
mid-2007. In March 2008, the Company received an abatement of penalties on this
obligation and, as a result, wrote-off accrued penalties of $68,026.  The
Company has recorded accrued interest from the date the taxes were due, through
the date the taxes were paid. The total amount recorded for this obligation at
September 30, 2008 and December 31, 2007 was $40,000 and $108,026, respectively.  NOTE 6  STOCK OPTIONS As of September 30, 2008, there were 20,010,000 options
outstanding, all of which were vested.  For the nine months ended September
30, 2008, the compensation expense for stock options was $147,502.
  There were no stock options exercised for the nine months ended
September 30, 2008 and 2007. On July 24, 2008, 3,600,000 options were cancelled.
 On the same date, the Board of Directors approved issuing the same number
of options, at the current stock price, under a new stock compensation plan,
contingent upon approval of the plan by the companys shareholders.  The
shareholders have not yet voted to approve this plan.  Stock Option Activity The following is a summary of all stock option
transactions for the nine months ended September 30, 2008: Outstanding at December 31, 2007
25,010,000Granted at market price
800,000Cancelled or
expired
(5,800,000)Exercised
-Outstanding at September 30,
2008
20,010,000  At September 30, 2008, the Company had no stock options
outstanding for which the exercise price was lower than the market value of the
Companys common stock.  For additional or supplemental information
regarding the Companys stock options, see our Form 10-KSB for the fiscal year
ended December 31, 2007.  NOTE 7 - DERIVATIVES On December 28, 2007, eTelcharge entered into a
securities purchase agreement with Golden Gate Investors (GGI).  Under
the purchase agreement, eTelcharge issued to GGI a debenture (the Debenture),
convertible into eTelcharges common stock, in the amount of $1.5 million.
 GGI paid for the debenture by delivering a cash payment of $200,000 and a
note for $1.3 million from GGI to eTelcharge.  At any time, GGI may convert
a portion of the Debenture equal to the amount of cash paid to eTelcharge on the
initial issuance of the Debenture and pursuant to payments made under the note
from GGI, into common stock at a conversion price equal to the lesser of $0.50
per share or 80% of the three lowest Volume Weighted Average Prices (VWAP) of
eTelcharges common stock during the 20 trading days preceding the election to
convert.  As of September 30, 2008 and December 31, 2007, $340,000 and
$200,000, respectively, of the Debenture was convertible.  At September 30,
2008, GGI has requested conversion of $10,000 (2,435,460 shares) which the
Company has not granted. The Debenture
further provides for eTelcharge to have the right, but not the obligation, to
choose to prepay any portion of the Debenture that the holder has elected to
convert, for an amount equal to 120% of such amount, when the VWAP is below
$0.05 per share.  The Debenture also provides that the holder may not
exercise the conversion privilege to the extent that it would acquire
beneficial ownership of eTelcharges common stock of more than 4.99%, which
may be increased to 9.99% on not less than 61 days prior notice, or such
limitation may be removed entirely on 61 days prior notice by the holder. Under the Purchase
Agreement, GGI is required to purchase up to three additional debentures, each
in the amount of $1.5 million, on terms analogous to the Debenture, upon
satisfaction of the requirement that the Debenture, and each succeeding
debenture which has been issued subsequent to the Debenture, has no more than
$250,000 outstanding, i.e., the requirement arises when the prior debenture has
been converted or otherwise redeemed so that no more than $250,000 is
outstanding.  GGI has the right to eliminate its obligations to purchase
each of the three additional debentures by a payment of $100,000. The promissory
note delivered by GGI to pay for the Debenture requires GGI to pay $250,000 per
month beginning July 15, 2008, and bears interest at the rate of 8% per annum
and is payable at maturity, January 31, 2012, with interest payable to
eTelcharge monthly.  Interest on the Principal Amount of the Debenture is
also payable monthly to GGI, at the rate of 7.75% per annum in cash, or at the
option of the holder, in shares of eTelcharges common stock valued at the then
applicable conversion price.  The maturity date of the Debenture is
December 26, 2011. GGI failed to make the required payments on August 15,
September 15 and October 15, 2008.  Additionally, GGI did not make the
monthly interest payment due October 1st and November
1st. F6  The Debenture provides for various events of default, such as
failure to pay principal or interest when due, if it is determined that any
representations warranties or covenants made in the Purchase Agreement or other
related documents were false or misleading, certain insolvency conditions, if
eTelcharges common stock is no longer traded, if eTelcharge fails to file
required reports under the securities laws, if eTelcharge defaults on any
indebtedness exceeding $100,000, or if the VWAP of the common shares is $0.01
per share or less during the term of the Debenture.  In such event, the
Debenture holder would have the right to accelerate amounts due under the
Debenture and require immediate redemption of the Principal Amount of the
Debenture, at 120% of such amount, or 110% in the case of the default relating
solely to the VWAP of the common shares being $0.01 or less.  The Debenture is secured by a pledge of 3,000,000 shares
of common stock provided by a stockholder of eTelcharge.  The promissory
note issued by GGI is secured by all of the assets of GGI. eTelcharge has
identified that the Debenture contains more than one embedded derivative feature
which SFAS 133 requires to be accounted for as derivatives.  The derivative
features that have been bundled together in the compound embedded derivative
include: (1) the conversion feature of the debenture; (2) the put options to
redeem the debenture after an event of default or failure to deliver stock; and
(3) the call option to prepay the debenture subsequent to a conversion request
when the VWAP is below $0.05. These embedded derivatives have been bifurcated
from the host debt contract and accounted for as derivative liabilities in
accordance with EITF 00-19.  Since multiple derivatives exist within the
Debenture, they have been bundled together as a single hybrid compound
instrument in accordance with SFAS No. 133 Derivatives Implementation Group
Implementation Issue No. B-15.  The value of the compound embedded
derivative liability was bifurcated from the debenture and recorded as a
derivative liability, which results in a reduction of the initial carrying
amount (as unamortized discount) of the related debenture at inception. The impact of the
application of SFAS 133 and EITF 00-19 on the balance sheet as of September 30,
2008, December 31, 2007 and December 28, 2007, the date of the agreement, was as
follows:  September 30,2008

December 31,2007

December 28,2007Net balance
$
340,000
$
200,000
$
200,000Less unamortized discount

135,625

144,642

144,845Convertible
debt
$
204,375
$
55,358
$
55,155  The unamortized discount is being amortized to interest
expense using the effective interest method over the life of the debenture. Lattice
Valuation Model eTelcharge valued
the compound embedded derivative features in the 2007 Debenture using a Lattice
Model. The lattice model values the compound embedded derivatives based on a
probability weighted discounted cash flow model. This model is based on future
projections of the five primary alternatives possible for settlement of the
features included within the compound embedded derivative, including: (1)
payments are made in cash, (2) payments are made in stock, (3) the holder
exercises its right to convert the debenture, (4) eTelcharge exercises its right
to convert the debenture and (5) eTelcharge defaults on the debenture.
eTelcharge uses the model to analyze (a) the underlying economic factors that
influence which of these events will occur, (b) when they are likely to occur,
and (c) the common stock price and specific terms of the debenture such as
interest rate and conversion price that will be in effect when they occur. Based on the
analysis of these factors, eTelcharge uses the model to develop a set of
potential scenarios. Probabilities of each scenario occurring during the
remaining term of the debenture are determined based on managements
projections. These probabilities are used to create a cash flow projection over
the term of the debenture and determine the probability that the projected cash
flow would be achieved. A discounted weighted average cash flow for each
scenario is then calculated and compared to the discounted cash flow of the
debenture without the compound embedded derivative in order to determine a value
for the compound embedded derivative.  The primary determinants of the economic
value of a compound embedded derivative under the lattice model are (1) the
price of eTelcharge's common stock, (2) the volatility of eTelcharge's common
stock price, (3) the likelihood that eTelcharge will be required to pay
registration delay expenses, (4) the likelihood that an event of default or a
change in control will occur, (5) the likelihood that the conversion price will
be adjusted, (6) the likelihood that eTelcharge's common stock will be listed on
an exchange, (7) the likelihood that eTelcharge will be able to obtain
alternative financing and (8) the likelihood that eTelcharge would be able to
force conversion of the debenture.  F7  The fair value of the compound
derivative embedded in the Debenture as of September 30, 2008, December 31, 2007
and December 28, 2007 determined using the lattice valuation model was based on
the following management assumptions:  September 30,2008

December 31,2007

December 28,2007Assumptions:The price of the eTelcharges common stock would
increase at a rate commensurate with the cost of equity, with a volatility
of:
120%

142%

142%Percent likelihood that an event of default or a
fundamental change would occur, increasing over time:
5%

5%

5%eTelcharge would redeem the Debenture if
eTelcharges common stock price is below (starting at 0% increasing 2% per
month to a maximum of 90%):
$0.05

$0.05

$0.05  Based on these management assumptions, the fair value of
the embedded derivative as of September 30, 2008, December 31, 2007 and December
28, 2007 was calculated by management to be $87,593, $144,643 and $144,845,
respectively. All of the above
assumptions are reviewed quarterly and are subject to change based primarily on
managements assessment of the probability of the events described occurring.
Accordingly, changes to these assessments could materially affect the
valuation.  Fair Value Measurements  In September 2006, the Financial Accounting Standards
Board (FASB) issued Statement of Financial Accounting Standards No. 157 Fair
Value Measurements (SFAS 157).  SFAS 157 introduces a framework for
measuring fair value and expands required disclosure about fair value
measurements of assets and liabilities.  SFAS 157 for financial assets
and liabilities is effective for fiscal years beginning after November 15, 2007,
and the Company has adopted the standard for those assets and liabilities as of
January 1, 2008 and the impact of adoption was not significant.  At June
30, 2008, the Companys derivative liability of $142,684 is carried at fair
value measured on a recurring basis.  The fair value is determined based on
Level 2 inputs as defined in the valuation hierarchy of SFAS 157.
 Accordingly, the Company considers the financial assets and liabilities as
reported in the Companys financial statements to approximate their respective
fair value.  In February 2008, the FASB decided that an entity need
not apply this standard to nonfinancial assets and liabilities that are
recognized or disclosed at fair value in the financial statements on a
nonrecurring basis until the subsequent year.   The Company continues
to evaluate this standard with respect to its effect on nonfinancial assets and
liabilities, but does not expect it to have a material impact on its results of
operations or financial condition.  In February 2007, FASB issued SFAS No. 159,
The Fair Value Option for Financial Assets and Financial Liabilities Including
an Amendment of FASB Statement No. 115. The fair value option permits entities
to choose to measure eligible financial instruments at fair value at specified
election dates. The adoption of SFAS 159 in first quarter 2008 by the Company
had no impact on the financial statements.  NOTE 8 - INCOME TAXES  eTelcharge uses the liability method, where deferred tax
assets and liabilities are determined based on the expected future tax
consequences of temporary differences between the carrying amounts of assets and
liabilities for financial and income tax reporting purposes. eTelcharge has
incurred significant net losses in past years and, therefore, has no tax
liability. The net deferred tax asset generated by the loss carry-forward has
been fully reserved. The difference between the statutory tax rate and the
effective tax rate relates to the valuation allowance applied against the
deferred tax assets generated from net operating losses. The cumulative net
operating loss carry-forward is approximately $12,046,953 and $10,233,034 at
September 30, 2008 and December 31, 2007, respectively, and will expire in the
years 2020 through 2028.  At September 30, 2008 and December 31, 2007, deferred tax
assets consisted of the following:  September 30,
2008

December 31, 2007Net operating losses
$
1,807,043
$
1,499,274Less: valuation allowance

(1,807,043)

(1,499,274)Net deferred tax asset
$
-
$
-  F8  NOTE 9 - COMMITMENTS AND
CONTINGENCIES  On June 11, 2008, eTelcharge entered into an Equity
Acquisition Agreement (the Acquisition Agreement), with PaymentOne Corporation (P1), and The Billing Resource, d/b/a
Integretel, Inc. (TBR).  Under the Acquisition
Agreement, the Company would acquire approximately 98% of the equity interests
of P1 from TBR in exchange for the Companys agreement to operate P1s business in the ordinary course
with an immediate payment by the Company of $1,500,000 cash and, to provide
additional capital support to P1, and to guarantee certain of P1s debts and obligations, including
accounts payable. As conditions to closing, the remaining approximately 2% of
outstanding P1 equity owned by its minority stockholders will also be acquired
by the Company in exchange for 642,185 shares of the Companys common stock, and certain
outstanding options for P1 equity will be cancelled and replaced on a formula
basis with options to purchase $500,000 (valued as of the closing date) of the
Companys common stock, while the remaining outstanding options for P1 equity
will be cancelled on terms reasonably acceptable to the Company and P1. It is
anticipated that P1 and TBR will continue to provide to each other certain
shared and support services following the closing upon substantially the same
pricing and other terms existing prior to the closing.  In addition,
following the purchase of equity interests from TBR, the Company has agreed to
convey to TBR approximately $12.8 million of debt owed by TBR to P1, subject to
adjustment under certain circumstances, effectively canceling this obligation.
 The terms of this acquisition remain under consideration by both parties;
however, no projected closing date has been set as of this time and the closing
of this transaction continues to be uncertain.  During the quarter ended June 30,
2008, the Company capitalized $230,000 of legal fees related to this
acquisition.  However, due to the uncertainty of the eventual closing of
the transaction, this amount was written off in the current quarter.  On July 24, 2008, the Board of
Directors approved a stock grant of 10,000,000 shares of the Companys common
stock to Robert Howe, CEO.  Additionally the Board of Directors approved a
twelve month consulting agreement for 19,500,000 shares.  Both of these are
contingent upon the shareholders approval of an increase in the authorized
number of shares of the Companys common stock to 3 billion shares.  On October 15, 2008, the IRS filed a
tax lien against the Company for unpaid interest in the amount of $33,793.  eTelcharge has several agreements with employees and
consultants that require eTelcharge to issue shares of common stock if the
agreements are fulfilled by the employees and consultants.  At September
30, 2008, eTelcharge will be required to issue up to 4,311,667 shares of common
stock over the next 12 months under existing agreements.  eTelcharge is obligated to issue 10,000 shares of common
stock to each director each year for director services provided to
eTelcharge.  eTelcharge typically has four directors.  In February 2007, eTelcharge entered into a modified
lease agreement extending the lease expiration to January 2010. The new base
rent is $4,098 per month.  Under the new lease, future minimum lease commitments are
as follows:   2008  3 months
$12,2942009
$49,1762010
$4,098  Rent expense totaled approximately $30,985 and $35,047
for each of the nine months ended September 30, 2008 and 2007, respectively.  F9  NOTE 10 - COMMON
STOCK  Since inception and through September 30, 2008, the
following share activity occurred:  Shares

AmountShares for cash
80,558,157
$
2,125,605Shares for services
159,553,914

12,177,753Shares for items paid on the Companys
behalf
11,327,134

243,548Settlement of debt
50,000,000

800,000Conversion of debenture to common stock
9,548,873

85,877Shares for assets
12,800

4,800Amortization of stock options
-

873,751Share cancellation
(120,000)

-Imputed Interest
-

63,038Totals
310,880,878
$
16,374,372  During the nine months ended September 30, 2008,
eTelcharge issued 9,596,077 shares valued at $489,213 for services rendered to
the Company.  Of the total amount issued, $395,778 was for current period
services, and $93,435 was for services performed in prior periods and was
accrued at December 31, 2007.     F10  Item 2. Managements
Discussion and Analysis of Financial Condition and Results of Operations.  Managements discussion and analysis of financial
condition and results of operations contains various forward looking
statements within the meaning of Section 21E of the Exchange Act of 1934,
regarding future events or the future financial performance of the Company that
involve risk and uncertainties.  Certain statements included in this Form
10-Q, including, without limitation, statements related to anticipated cash flow
sources and uses, and words included but not limited to  anticipates,
believes, plans, expects, continue, will, and similar expressions are
intended to identify forward- looking statements within the meaning of section
27A of the Securities Act of 1933 and Section 21E of the Securities act of 1934
regarding events, conditions, and financial trends that may affect our future
plans of operations, business strategy, operation results and financial
position.  We caution readers that a variety of factors could cause our
actual results to differ materially from the anticipated results or other
matters expressed in forward-looking statements.  Readers should carefully
review the risk factors and any other cautionary statements contained in the
Companys Annual Report on Form 10-KSB and other SEC filings.  The Company
undertakes no obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, or otherwise.  The following information should be read in conjunction
with our financial statements and notes thereto appearing elsewhere in this Form
10-Q.  We had a net loss of $1,813,919 during the nine months
ended September 30, 2008; a decrease of $352,689 compared to a loss of
$2,166,608 for the nine months ended September 30, 2007.  The decreased
loss primarily resulted from a decrease of approximately $590,000 loss on
extinguishment of debt, a decrease of approximately $756,000 in stock option
expense, an increase of approximately $74,000 interest income and $88,000 income
caused by a change in derivatives, partially offset by an increase in
professional fees of approximately $889,000 and an increase in employee
compensation of approximately $362,000.  For the three months ended September 30,
2008, the Company had a net loss of $768,169, a decrease of $103,371, compared
to a loss of $871,540 for the three months ended September 30, 2007.  The
decrease in loss resulted primarily from a decrease in stock compensation
expense of $410,000, a decrease in license fees of $71,000, a $40,000 charge
last year due to the settlement of a lawsuit, and  current year income of
$89,000 for the change in the fair value of the derivative instrument, partially
offset by a $249,000 increase in professional fees, a $203,000 increase in
employee compensation and a $52,000 gain on extinguishment of debt last
year.  Working capital deficit at September 30, 2008 was
$930,539 compared to $198,704 at December 31, 2007.  The decline in working
capital is primarily the result of an increase in accounts payable due to a cash
shortage experienced by the Company.  Our ability to operate profitably depends on generating
sales and achieving sufficient gross profit margins.  We cannot assure that
we will achieve or maintain profitable operations in the future.  Our ability to continue in operation is dependent upon
our ability to raise sufficient working capital to cover our expenses. However,
there can be no assurance that we will be successful in doing so. Due to our
lack of capital and our need for working capital to continue our business, our
auditors included an explanatory paragraph as to our ability to continue as a
going concern as part of their audit opinion of our financial statements for the
year ended December 31, 2007. We have generated approximately $135,000 of
revenue since our inception and since inception through the nine months ended
September 30, 2008 we incurred a cumulative net loss of $17,484,284 including a
net loss of $1,813,919 for the nine months ended September 30, 2008.  Our operations have been primarily funded through the
issuance of our common shares. Total cash proceeds for the issuance of common
shares totaled $2,125,605 from inception through September 30, 2008, and
$185,100 from December 31, 2007 through September 30, 2008. In order to continue
in business we must continue to raise capital, as revenue from operations will
be insufficient in the short term to meet our working capital needs. However, we
cannot assure that any such capital will be available to us. Based upon our
current cash resources, we cannot meet our cash requirements or institute our
business plan unless we raise additional funds, or unless our revenue grows
significantly.  In connection with the Companys agreement to purchase
P1, as described in Note 9 to the financial statements, the Company has agreed
to provide capital support of approximately three million dollars to P1, in
connection with the closing of the transaction.  There can be no assurance
that the Company will be able to raise the capital in order to do so.  In
addition, the Company has agreed to guarantee certain of P1s debts and
obligations following the closing, which could have an impact on the Companys
financial condition, if the transaction closes.  Off-Balance Sheet Arrangements  None.  Item 3. Quantitative and Qualitative Disclosures About
Market Risk.  Not applicable.  2  Item 4T. Controls and
Procedures  As required by Rule 13a-15 under the Securities
Exchange Act of 1934 (the Exchange Act), we carried out an evaluation of the
effectiveness of the design and operation of our disclosure controls and
procedures as of June 30, 2008. This evaluation was carried out under the
supervision and with the participation of our Chief Executive Officer and Chief
Financial Officer. Based on their evaluation of our disclosure controls and
procedures and on the material weakness disclosed in our December 31, 2007 Form
10KSB, we concluded that such disclosure controls and procedures were
ineffective as of September 30, 2008 to ensure that information required to be
disclosed by us in reports that we file or submit under the Exchange Act is
recorded, processed, summarized and reported within the time periods specified
in Securities and Exchange Commission rules and forms.  Changes in Internal Control Over Financial
Reporting  During our most recent fiscal quarter, there has not
occurred any change in our internal control over financial reporting that has
materially affected, or is reasonably likely to materially affect, our internal
control over financial reporting.  PART II  OTHER INFORMATION  Item 1. Legal Proceedings  None  Item 2. Unregistered Sales of Equity
Securities and Use of Proceeds  During the quarter ended September 30, 2008, eTelcharge
issued to one consultant, one employee and two directors of the Company (one of
which is also an employee) shares of common stock in consideration of services
provided, as set forth in the table below.  These shares were issued
without registration in reliance upon the exemption afforded by the provisions
of Section 4(2) of the Securities Act, based on the fact that the issued shares
were not sold or offered pursuant to general solicitation, and that the
consultants had sufficient sophistication and access to information about
eTelcharge.  In addition, such shares bear a legend indicating such
restrictions on transferability.  Date
Number of Shares Issued
Value of Services ($)08/20/08
99,166
3,685  As described in the chart below, the Company agreed to
issue to one accredited investor shares of its common stock for cash.
 These purchases and sales were made without registration in reliance upon
the exemption afforded by the provisions of Section 4(2) of the Securities Act
of 1933, as amended (the Securities Act), and Rule 506 promulgated thereunder,
based on the fact that the issued shares were not sold or offered pursuant to
general solicitation, and in reliance upon the representations of such investors
as to such investors status as an accredited investor and investment
experience, that such investor had access to information about the Company, that
such investor was purchasing such securities for its own account and not with a
view to resale or distribution or any part thereof in violation of the
Securities Act and an acknowledgement by such investor that resale of such
securities may not be made unless registered under the Securities Act or another
exemption from registration is available.  In addition, such shares
bear a legend indicating such restrictions on transferability.  Date
Number of Shares Issued
Cash Consideration07/01/08
333,333
5,00007/11/08
400,000
6,00007/11/08
173,333
2,600906,666
13,600  In addition, $20,000 was received at the end of the
quarter ended September 30, 2008 for the purchase of the Companys common
stock, and the stock has not been issued as of November 4, 2008.  Item 3. Defaults Upon Senior
Securities No senior securities exist.         3  Item 6. Exhibits  Exhibit
No. Description  31.1 Rule 13a-14(a)/15d-14(a)
Certification of Robert M. Howe III  31.2 Rule
13a-14(a)/15d-14(a) Certification of Robyn Priest  32.1 Section 1350
Certification of Robert M. Howe III  32.2 Section 1350
Certification of Robyn Priest  4  SIGNATURES  Pursuant to the requirements of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.  eTELCHARGE.COM (Registrant)   Date: November 14, 2008 /s/ Robert M. Howe III By: Robert M. Howe III Title: President and Chief Executive
Officer    Date: November 14, 2008 /s/ Robyn Priest By: Robyn Priest Title: Senior Vice President -
Finance and Chief Financial Officer  5