I just got a new 1505 and plugged in a headset and I alo could hear clearly but the person on the other end couldn't hear me unless I had the mike right in front of my mouth.  Luckily it wasn't breaking up.  Could be the quality of the microphone. 

I used 2 good quality mic's Logitec and Altec Lansing.

So I am not sure if that is a problem, but I think it is some setting which needs to be done or something else.

 

I was planning buy a new headset with mic today.  I will report on what I find. 

I bought an earclip headset this weekend. 

Cyber Acoustics Ear Clip Headset with Boom Microphone
Model: AC-740

At Best Buy it was $20.99.  It works perfectly.  As I said I had borrowed one the other day and it worked also.  I'm guessing it is your machine. 

Good luck

I have the same issue with my E1705, and I am very upset about it. It seems that many people have this issue, and noone knows the cause or a solution. Could anyone from Dell please comment?

Thanks,
Tibor

I need to update my findings.  When I first tested my new headset it seemd to work fine.  On subsequent uses the people at the other end complained that my voice kept breaking up.  There must be some problem with this machine.  Is anyone at Dell monitoring these forums? 

Like many here, I found this to be exasperating... after some search, I found this link below and intalled the driver for Sigmatel to my E1505. And sound recording this time didn't cut off and volume was ok, both on Audacity and Windows Sound Recorder. For my course, I need to work with audio a lot. I haven't tested my audio over chat like AIM or Eluminate yet. I like to keep informed of this issue...

best wishes,

http://support.dell.com/support/downloads/download.aspx?c=us&l=en&s=gen&releaseid=R122161&SystemID=InspironI6400/E1505&os=WW1&osl=en&deviceid=8907&devlib=0&typecnt=1&vercnt=2&formatcnt=1&libid=3&fileid=162467

I downloaded the file and installed and so far so good.  Thanks.