We use Skype and Facebook too. But definately Skype for the children. I have a 3 yr old and a 2 yr old and sunday night is our designated Skype time to Grandparents and this sunday night we had the laptop in my DS's bedroom as they both had their story and milk and my mum was able to see him get tucked in to bed and say night night - really special
We have just started using Facetime on iphones. This means that we can video-call each other in a wi fi area so at schools and parties and things.
I always try and talk to my children about my family in normal conversations so I will say 'you are four like Edward' rather than 'you are four like Jarred' or some Australian friend they have now. So that they feel that connection and they know that their aunt has a cat and their Grandma likes coffee cake. It's all small things but I really think it helps them feel as if they know those people.
Like savoycabbage I try to mention my family as much as possible - so with my 3yo who is just learning the alphabet my family in NZ get priority for the letters eg N is for Nanna, C is for Carter (cousin) etc.
I also put quite a lot of energy into making birthday cards etc with the kids for people at home so that they also feel the kids are interested in them. And then the kids get letters etc which they love.
We've found Skype quite difficult as my mum found it hard to understand DS1 (partly speech impediment, partly his English had a funny rhythm from living in a foreign country) and he got frustrated and didn't want to do it, plus he always wants to get up and walk around! But might try again sometime.