Illinois Supreme Court Rule 206(h) allows for telephone depositions by agreement or upon order of the court. The various rules for telephone depositions listed in Rule 206(h) can be amended or waived pursuant to Rule 201(i). Generally, the exhibits that any party plans to use should be exchanged in advance of the deposition, and the court reporter should set up at the witness's location.
So here's the tip: Telephone depositions make sense from time to time, but in most cases, you won't want to be the lawyer on the telephone. If your opponent wants to attend a deposition by telephone, by all means allow him to do so. Meanwhile, you should appear in person. You'll have an obvious advantage over the other lawyer, who won't be able to exchange pleasantries with the witness in person and who will be fumbling with the exhibits when the deposition starts.
As a lawyer who's been in both situations, take it from me--it's better to be the lawyer who's present at the deposition in person, rather than the one who appears by telephone.