Zer01's mobile offer: Too good to be true?

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Global Verge and Buzzirk initially told sales associates that the actual phone service would be available on July 1. Now that the date has passed, they are asking for patience. Saying that it was taking longer than expected, Petschel told listeners on a recent conference call that the top-tier sales associates would start getting phones in the mail in the next week or two.

On Friday, Piilani said that Buzzirk had started turning on service for some agents and that more would be able to start using the service in the next month or so.

Petschel, Lance Dascotte, UTG's chief operating officer, and Ted Robbins, the president of Global Verge, are commonly featured on conference calls for sales associates that can happen as often as twice a week. Some of the associates post the calls online.

While Piilani said there are 50,000 associates, it's hard to confirm exactly how many people have signed up to become Buzzirk sales associates. There are many, many Web sites, some of them nearly identical, set up by sales people.

Rob O'Sullivan is one sales person who claims to have already signed up 250 other sales associates. He's been told not to expect to start getting commission checks for two-and-a-half months after he signed up to the program.

Meanwhile, Zer01's business model seems to change each time it issues a press release. When it launched in March at the CTIA trade show, it said it would directly offer the unlimited service to customers. Its press release called Zer01 a "new mobile national carrier" and said that "Zer01 mobile customers will be able to use their own smartphones or buy a new phone from the online store."

But in May, Zer01 said it would provide its unlimited voice and data service to Buzzirk Mobile subscribers. The service would be marketed by Global Verge, "a mobile virtual network operator for Buzzirk Mobile."

With a July 1 press release, Zer01 changed the content of its Web site and began calling itself a mobile virtual network enabler. Zer01's Web site now positions the company as one that "enables" MVNOs to offer unlimited voice and data services.

"Originally, we were going to go direct to market," Piilani said. "Since the [CTIA] show, we've gotten a lot of interest from distribution players as well as content companies because a lot are interested in unlimited access. So we changed the distribution model after CTIA. Now we're going in a different direction with partners and their brands."

On the Global Verge opportunity line, which anyone can dial into (712-432-1011 Pin: 483294772#), listeners can hear about the service and the sales associate plan. The mobile service is described as "unlimited everything." The handset will be like something out of a science-fiction movie, according to the call. The marketing program will make it easy for anyone to earn about $29,000 a month. "It's truly unbelievable," the voice says. He may be right.

Nancy Weil in Boston and Stephen Lawson in San Francisco contributed to this report.

Copyright © 2009 IDG Communications, Inc.

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