Ours live in Eastern Canada. Shorter flight than, say, the Aus/NZ, or Western America; but far enough! We have a 10-month-old GS, whom we visited over Christmas and they are coming over for a couple of weeks in the summer (summer? what is that, again??). But we have a regular time for a weekly skype-ing which suits us all - and if we aren't going to be available at that time we email or phone alternatives.
GS and I blow kisses on skype, I tell him about the latest toy I have bought for him, and we were all squealing with excitement when he learnt to crawl the other week and obligingly demonstrated for doting grans. I think he recognises us. We'll see, when they arrive here 'for real'! He might be surprised that we exist in 3-D, off screen!
Incidentally, our dog has learnt to bark for our attention if we are out of earshot when skype pipes up - v. useful!
To Lucyinthesky: I also find Skype difficult to hear, and my son talks so quickly that I can't listen fast enough (he says!). Facebook (which I know can be insecure and we have to be so careful) is fun, though. Now that I have so many new friends and relatives in Canada I really enjoy using it, sharing photos, chat, commenting on something crazy which doesn't merit a letter/phonecall/skype or whatever. And if the other party happens to be online at the same time, you can use instant messaging, too, which can have hilarious results if your instant typing is as typo-ridden as mine!
Life goes on - keeping busy helps, I agree.