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Truth starting to come out about Zer01

Leading up to July 1, there was no shortage of hype surrounding Zer01, the company which promised unlimited voice, messaging, and data for $70 per month. In the days leading up to their launch, they sent out some questionable marketing materials, claiming speeds equivalent to 5G. Yes, as in an entire generation faster than 4G, which won’t be deployed until later this year. I expressed my doubts, and many commenters chimed in as well. Now that the service has been “live” for a few weeks, we’re starting to learn a bit more — and it’s not good. Nancy Gohring of IDG News Service (via PC World) takes a deeper look at the operation.

Gohring uncovers a lot of dirt, and many inconsistencies, with Zer01′s parent company, Unified Technologies Group. This includes multiple corporate registrations, failure to file reports, and shady partnerships (more on that in a minute). It’s a bit of personal muckraking. As far as actual phone-related issues go, Gohring does bring one important point to light.

But both T-Mobile and AT&T say they don’t have relationships with Zer01. Without those operators, Zer01 is unlikely to be able to offer nationwide coverage, [analyst Jack] Gold said. If Zer01 had deals with all the other regional GSM operators, it still couldn’t piece together a nationwide service.

Beyond that, Gohring notes that there is no evidence that Zero01 owns any 2100 MHz spectrum, as some Buzzirk (more later) sales associates claim, but an FCC search shows that they’re also not leasing the spectrum.

This doesn’t even address the mutli-level marketing tactic that Zer01 employs. It’s run through Global Verge. Associates sign up, paying $70 up front and $40 per month for support. They then sell Zer01 under the Buzzirk brand. It works like any other MLM program. Associates sign up other associates, and those higher on higher rungs get a cut of those they signed up. Apparently, Global Verge has signed up 50,000 associates so far. That’s a lot of people selling a service that’s not really available right now.

Global Verge is run by Mark Petschel, who doesn’t have the most glowing legal record. He pleaded guilty to securities fraud, and has lost three contract disputes. He was also part of a company, Everge, which was to sell mobile services under the brand BizzBuzz (see the trend?). According to Gohring: “No such launch appears to have occurred.”

I recommend reading the entire article if you’re at all interested in Zer01′s service. But let me put it in the most succinct terms.

We have a decently large audience at Prepaid Reviews. I could easily leverage that audience by signing up to be an associate of Global Verge and then start selling Zer01 services to you, the readers. But I won’t. There’s no way I’d trust this operation enough to do it. I won’t go so far as to accuse them of anything. It’s just not a company I’d put my personal trust in.

We’ll wait for more to emerge on this. It surely will.

7 Responses

  1. Global Earl Says

    Well that seems fair to me..Don’t invest, don’t get involved until you feel comfortable. But know this, a large number of very successful people..have moved to this project. Currently I believe the figure to be less than 40K in Buzzirk, the rest maybe somewhere else for all I know.

    Mark Petschel has stepped down ans CEO and some sharp folks are coming in to run different departments.

    As you said..time will tell…I’m in and not in too much of a hurry, yet to recruit. But I’m in.

    Global Earl

    Posted on July 23rd, 2009 at 8:45 am
  2. Mike Papadopoulos Says

    I have been researching this company for quite some time and found out that most of their claims are bogus. They have not produced a phone that works yet. It seems like they are just after “distributors” that are willing to pay $400 over a six month time frame for an “e-affiliate” website. To my network marketing/mlm community, be aware of this one!

    Posted on July 23rd, 2009 at 8:52 am
  3. Peter Kent Says

    It is absolutely confirmed. Zer01 has NO relationship with ATT. NONE.

    Zer01 CEO Ben Piilani interviewed the day before ATT confirme no connection with Zer01 as he tries to address negative PR on Zer01/Buzzirk mobile’s failure to launch.

    Laptop Magazine , the publication which actually gave Product of the Year Award to Zer01 at the CTIA Wireless con earlier this year at Vegas has put Ben Piilani, Zer01 CEO on the grill and investigated his elusive response when asked if he had an agreement with Tmobile and ATT.
    Tmobile declined to comment so their relationship , if any with Zer01 is still uncomfirmed. However, Zer01′s gsm footprint/backbone is identical to ATT’s. Kind of hard to do that when ATT isn’t giving you any service though, isn’t it?

    Posted on July 23rd, 2009 at 8:26 pm
  4. Mike Says

    Dear E-Associates:

    We will be addressing several key issues in a different emails this afternoon and evening.

    In our opinion, one of the most important issues is the availability of phones and the SIM cards that allow them to work with the carrier so we can get them into our own hands and the hands of our customers.

    Currently, we have in the field about 10 working phones in our network using Zer01 and their awesome technology. These have been functioning for some time. We know the technology works.

    On Monday of this week we received two more updated SIM chips. They also work on Zer01′s system and have been used the past four days. In the next few days we will have SIMs that will boot up showing the Buzzirk Mobile logo, and a several of these will be given out. At that point we can begin to tout the phones publicly–show them off to the world.

    After that, a larger rollout is planned. Firm dates cannot be given or quantities until next week. Please understand that we are not the carrier and we do not produce the SIM cards and we do not control date of availability, we can only tell you what we are told. You will see announcements made next week explaining firm dates from the carrier.

    Let’s remind ourselves that we have an incredible opportunity in front of us. For those who have been frustrated by delays, we understand. This email is to tell you the product is real. Time frames will be laid out next week.

    We are aware of the insidious motives on the part of some individuals and companies coming out and try and take us down. They wish they were in our shoes and want us out of the way to take our place. Many of the people behind the attacks stand to gain financially and in their organizations if they can get rid of us, so they malign us. We know what they are saying publicly and some of the things they are saying behind closed doors. They have only one goal: to kill our opportunity to market this technology, and grab it from us.

    We are stronger in our resolve and in our ability to provide this technology the the masses than ever. You hope will stand with us, or watch from the sidelines if you choose. We are moving forward with our game plan.

    The Globalverge Team

    Posted on July 23rd, 2009 at 10:12 pm
  5. bob McKraken Says

    mike has pretty much nailed it.

    the key is ‘buzz’ coupled with word of mouth on an ‘important’ everyday tool that ‘you too can make money on’. i would expect every affiliate will be fleeced for the approx 6 month time frame as ‘technical details’ are being ‘worked through’. the clinchers in this one is not having any partnerships even on the horizon, let alone contracted, as well as the outright lie of operating on a 2100 mhz spectrum.

    let’s see. 40,000 x 310$ and we have 12,400,00$ without any standard reporting filed whatsoever, or any info on spending habits.

    i wonder if these guys will see any time in club fed.

    Posted on July 24th, 2009 at 6:58 pm
  6. Nearly Got Sucked In Says

    There is no large number of successful people in this charade. There are a lot of people hoping for a dream but the FACT is there is no patent, no technology, no phones, no services, no offices, no hope. Don’t listen to washed up earl if he was so successful he wouldn’t be touting the Next Day PC site you know the one that is distancing itself from Global Verge after singing up 3000 reps(he usually gets 50% so that might mean 6000 really signed up and not 40,000)anyway pop over to earls real site it’s got a picture of a 4 year old on it I would hazard a guess he designed the site but hey Earl is so successful he doesn’t need to employ a professional web designer.

    Posted on July 24th, 2009 at 9:09 pm
  7. EJ Carter Says

    (sorry I submitted my email wrong, and am correcting it now) for the sake of transparency, I am publishing my website. I am an affliliate of global verge.

    1) The technology that is promised here already exists overseas.

    2) The software that would allow any reseller to use their own brand already exists. for example one day you walk into Best Buy and all they sell is Best Buy Mobile and they ask you would you like to be on GSM or something different?

    3) I remember the first zip file on the computer allowed for the compression of data for storage and that was nothing more than a software program. so its feasable to me that something similar could happen.

    4) EVERYONE that is signing up so far are people hoping to go into business for themsevles. c’mon I am a big boy. I understand business risk and upside potential.

    5) This will happen, if not with Buzzirk or Zer01, someone else. Remember SPRINT built their business this way! If anyone company gets it and the threat and the opportunity it would be them.

    Posted on July 27th, 2009 at 3:07 pm

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