Zer01promotes heavily, enlists sales reps, but service "remains elusive"
Nancy Gohring, of IDG News Service, has a classic, highly detailed investigative story on Zer01, a company that promises you can do anything you want with its $70/month wireless plan, and earn money by signing up others for the same service.
Except it’s unclear whether any service actually exists.
The company’s persuasive pitch convinced a lot of people, including CNet, Laptop Magazine, CTIA 2009 where it was a finalist for the association’s emerging technology awards, and our own Mark Gibbs.
Digging deeper, Gohring found a nest of inter-related companies rife with vague details, shadowy connections, and unsubstantiated claims. One is Global Verge headed by Mark Petschel, who is currently on probation after pleading guilty to securities fraud. Global Verge is a marketing firm that’s recruiting people to sell the Zer01 service (under the brand Buzzirk): these recruits pay a one-time enlistment fee of $70, then $40 a month thereafter for “back office support.”
Zer01’s CEO, Ben Piilani, told Gohring that the company offers nationwide wireless services through deals with several GSM operators, which he said couldn’t be named, and combines that with an extensive nationwide fiber network owned by Zer01’s parent, UTG.
Yet both T-Mobile and AT&T, the dominant GSM operators in the country, told Gohring they have no relationship with Zer01. But without those deals, as consultant Jack Gold noted in Gohring’s story, “Zer01 is unlikely to be able to offer nationwide coverage.”
Don’t miss Gohring’s follow-up: after the original story appeared, UTG has stripped its Website of nearly all detailed information.
