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Reasons To Hesitate On Zer01's Unlimited Mobile Offer 122

alphadogg writes with an excerpt from Network World that might save you some money: "Imagine downloading a two-hour HD movie in three minutes to your new cell phone, then plugging the phone into your TV to watch the film. Make unlimited phone calls, surf online as much as you like and send unlimited text messaging for $70 a month, without a contract. Sign up to sell the same service to other people and get $10 a month for each person you sell to. That's what a group of related companies including Zer01 Mobile, Buzzirk, Global Verge and Unified Technologies Group are promoting heavily online and at industry trade shows. The offer is attractive enough to garner coverage in top business and technology publications, at least one positive review from an analyst and even a 'best in show' award from a magazine at the CTIA wireless industry trade show earlier this year. Does it all sound too good to be true? If so, that's because it probably is. What little information is available about the services is technically inconsistent, and doesn't match up with public records."
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Reasons To Hesitate On Zer01's Unlimited Mobile Offer

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  • by Anonymous Coward on Monday July 20, 2009 @05:08PM (#28761991)

    They had me at pyramid scheme.

  • by Dunbal ( 464142 ) on Monday July 20, 2009 @05:09PM (#28762005)

    Surely email has taught us that we can absolutely trust anything offered for sale by someone u51Ng 1337 sp34k! Shame on you.

  • by Com2Kid ( 142006 ) <> on Monday July 20, 2009 @05:11PM (#28762025) Homepage Journal

    They want to speak with someone over at Zer01, something about "exceeding sane limitations of the electromagnetic spectrum".

    An HD movie in 3 minutes? Even if they are calling "480p" HD, there is no way in hell that is transfering wirelessly in 3 minutes to a cellular device.

    Trying to sign everyone up as a sales associate just proves it is a scam.

    • Re: (Score:2, Insightful)

      something about "exceeding sane limitations of the electromagnetic spectrum".

      Actually, it was a prank call. The "electromagnetic spectrum" is not a finite resource. It would be more practical to say "with existing technology and certain economic factors, paying $70 for this is flatly unfeasible."

      • by Com2Kid ( 142006 ) <> on Monday July 20, 2009 @05:46PM (#28762535) Homepage Journal

        They are claiming use of the 2100mhz spectrum. Given the spectrum they are claiming to be using, there is no way to use cellular technology (wireless towers, multiple customers handled per tower) to get those types of speeds.

        Sure, if they crap all over everyone's licensed EM bands they could maybe pull it off, but even then they would encounter issues with running enough fiber out to every single cell tower to support users on any arbitrary tower pulling down in excess of 200mb/s, assuming a well compressed, somewhat short, 5GB HD movie.

        It is just not possible with using a cellular network laid out how we presently do it. Even using some futeristic weird uber-mesh network it would be hard as hell to pull off, and even then, you would need more than just some small slice of the 2100mhz band.

      • by Frnknstn ( 663642 ) on Monday July 20, 2009 @06:05PM (#28762755)

        The "electromagnetic spectrum" is not a finite resource.

        Yes [] it [] is. []

    • It's this movie []. Unfortunately there's no sound.
    • by sanosuke001 ( 640243 ) on Monday July 20, 2009 @05:19PM (#28762161)
      I have a 1080p copy of a movie at home and it's ~8GB.

      8 GB in 180 seconds = 364.09 mbps.

      um.... no
      • Re: (Score:3, Informative)

        doing the math, that's 45.5 MB/s, pretty much the sustained data transfer rates of a SATA hard disk.

        and that over a wireless link, right ?

        I hate to bust their scam, but you're gonna need a very special, fine tunned setup to get this kind of transfer rates over _wired_ gigabit ethernet. the fastest wireless standard is 54 mbps (not counting draft standards), 1/20th the performance of gigabit. to transfer an SD movie over wireless from my linux notebook to the PS3 takes about 30 min.

        if we take the comparative

        • doing the math, that's 45.5 MB/s, pretty much the sustained data transfer rates of a SATA hard disk.

          More like half the sustained speed. My several year old 320G SATA drives manage 55-60M/s sustained no problem, the newer ones are closer to 90-100M/s (and yes, that's plain old 7200 RPM drives, not the fancy Velociraptors or anything).

        • by psm321 ( 450181 )

          I get 70 MB/s over gigabit ethernet all the time, no special tuning. Of course doing that over a cell network would be ridiculous :)

    • by martas ( 1439879 )
      well, i'm sure that's not impossible. but i'm also sure it can't be done for at least another 10-15 years...
    • by Joce640k ( 829181 ) on Monday July 20, 2009 @05:53PM (#28762623) Homepage

      You can have a two hour movie at 1080p resolution in 1Mb of data if you're not too fussy about image quality.


      Resolution is one thing, bitrate is something else.

    • Re: (Score:3, Informative)

      by SlashDev ( 627697 )
      1) What if your handset supported 4G? 2) Did they specify the length of the film? :) 4G can support 100Mbits/s while moving and 1Gbits/s while stationary, that translates to downloading a movie (no telling how long) in a few minutes. "The Japanese company NTT DoCoMo has been testing a 4G communication system prototype with 4x4 MIMO called VSF-OFCDM at 100 Mbit/s while moving, and 1 Gbit/s while stationary. In February 2007, NTT DoCoMo completed a trial in which they reached a maximum packet transmission
      • by anagama ( 611277 )
        There's no point in comparing what people can get in a technically advanced country to what we can get here. Between Comcast and the one or two other providers who cringe at the thought of offering any sort of actual competition, we should bless our lucky stars to have a tenth the bandwith at thrice the cost of what people can get elsewhere, even in spread out countries like Canada.
      • This is the great thing about low interest rates. If there's any potential to break even and possibly make a profit, it gets funding.

      • Re: (Score:2, Insightful)

        by Com2Kid ( 142006 )

        Lovely lovely speeds, on an isolated unpopulated cell tower. Two customers on that tower downloading movies? Speed cut in half. Aww crap, 100 people? You are going to be waiting awhile.

        And again, speeds would need to be around 45 MegaBYTES per second, well over 300mbit, and even if we cut that down to just 100mbit per second, do you really think companies are going to run enough fiber to give each user on a tower 100mbit of bandwidth on every cell tower in a city?

        The difference between what almost any s

    • An HD movie in 3 minutes? Even if they are calling "480p" HD, there is no way in hell that is transfering wirelessly in 3 minutes to a cellular device.

      Even if the cellular network could handle that throughput, the phone could not. Without a TCP Offload Engine, a CPU is progressively taxed the higher a system's throughput is when transferring data. With the bandwidth required to download an HD movie in 3 minutes the phone's processor just couldn't handle the processing required but TCP is notoriously bulky and I don't think it is used by cell phones so maybe whatever transport protocol they use can support that kind of throughput with little overhead. Any

      • by Com2Kid ( 142006 )

        When downloading a file through your phone's web browser you most certainly are using TCP/IP.

        That said, the processor in many cell phones is no less powerful than the processor in many home routers, typically it is an issue of a MIPS CPU versus an ARM CPU, but in a general sense they have similar capabilities (specialized instructions on each not withstanding).

        In other words, my phone has a 600mhz CPU with 256MB of RAM, I don't think TCP/IP is going to be the limiter.

        Now the crappy SD chipset implementation

    • by Minwee ( 522556 ) <> on Monday July 20, 2009 @10:27PM (#28765121) Homepage

      An HD movie in 3 minutes? Even if they are calling "480p" HD, there is no way in hell that is transfering wirelessly in 3 minutes to a cellular device.

      Sure you can. I do that all the time. You just need to do away with some of your preconceptions.

      Watch this. On the left I have a phone. It's a standard, off the shelf model, the same kind you can pick up just about anywhere pretty cheaply as long as you're willing to sign in blood.

      On the right, a microSD card packed with about eight gigabytes of hard core, er, family friendly and perfectly legal video. Again, just a standard card you could buy from a store. Well, one that carried SD cards. Perhaps you shop smart, shop SD Mart.

      Start the timer. In less than two seconds I can pick up the card with one hand, move it across the desk and plug it in to the phone. That's eight gigabytes of transfer in two seconds or 32Gb/s. All without using any wires, just fingers and those little metal contact thingies on the card. That's almost as much bandwidth as a station wagon filled with DLTs.

      There you go. 32Gb/s of wireless transmission. Just remember not to divulge any of the details I have shown you to the investors until after you get their money.

      • by MaerD ( 954222 )

        Perhaps you shop smart, shop SD Mart.

        I did, until they met the MPAA/RIAA's boomstick.

  • Full stop (Score:5, Insightful)

    by Anonymous Coward on Monday July 20, 2009 @05:11PM (#28762035)

    From TFA

    One key player in the network of companies is Mark Petschel. He's the CEO of Global Verge, the multilevel marketing firm...

    Whenever MLM [] (multi-level-marketing) rears its ugly head, that's a good sign for me to avoid company like the plague.

  • i thought companies were trustworthy honest people, they would never lie to us
  • MLM (Score:5, Insightful)

    by MBCook ( 132727 ) <> on Monday July 20, 2009 @05:12PM (#28762057) Homepage

    Sign up to sell the same service to other people and get $10 a month for each person you sell to.

    That makes it multi-level-marketing (read: "legal pyramid scheme"), which should be an instant clue to anyone to avoid it.

    Also, reading the article, it's a $70 initial fee to do the MLM part, and $40 monthly fee, which means if you sign up 5 people, it will take 7 months to break even.

    You can probably make money faster by picking up loose change.

    • Re: (Score:3, Funny)

      by picking up loose change.

      Especially if the change is loose in someone's pocket ;)

    • Or by standing in the street playing the violin.

      You don't need to be able to play the violin to make money playing one on the streets. In fact its a positive advantage not to - shopkeepers come out and pay you to move away.

    • Re: (Score:3, Insightful)

      by anagama ( 611277 )

      I haven't completely read the article, but this doesn't sound like MLM. In MLM, a person will get a cut of the revenue from the people who sign up under the people he signed up. This sounds like a discount for a referral, which can be perfectly legit. My webhost will give me a hosting credit if I refer someone who signs up. I've never even tried to get the credit, even with people I did suggest use my host, but that isn't MLN -- it's an incentive to make a referral.

      Note: I am not a MLM junkie by any st

      • by MBCook ( 132727 )

        Re-reading it, you're right. It looks like a simple affiliate program like the ones at Amazon or Dreamhost (both of which I use). I jumped the gun on that one.

        Still, any affiliate program that requires a $40 monthly fee should really make someone's hair stand on end. The $70 initial fee is insane too.

        I agree MLM is a scam. Anyone who can make money doing it could make money being a real sales/management person at a normal company. I just find it slimy.

        But any product where, as a part of the initial pitch, t

        • by DavidTC ( 10147 )

          Any affiliate program that requires any monthly fee should be a big warning sign. Period. That is you paying them to work for them, and is totally insane.

          Even ones that require a flat fee to join should be looked at, unless it's a nominal one.

          Something like $5 to keep riffraff out would be reasonable, that would help keep out spammers, who keep signing up for new accounts when their old account get killed for spamming. Heck, just making people type in credit card numbers and billing them a dime will make

      • by maxume ( 22995 )

        I'm pretty sure it is MLM. My mom forwarded something to me a few weeks ago that mentioned Bizzerk; when I checked it out, the information discussed the differences between traditional multi level marketing and a forced matrix scheme. It was pretty obvious.

    • I'm actually surprised Amway never got into the cell business. They did jump into the Internet with quixstar, the 'oh we're not amway - this is different' branch of the company that is now branded as amway. I guess technology might not be the best thing for their business plans.
    • Yeah, but you don't get unlimited mobile data while picking up loose change.

      Yeah, I'm assuming it's not a scam (which it more than likely is) but your point is moot. You don't go into one of these schemes to break even; You go into it to pay for a service which you then use.
  • welcome our new A.I. overlords, and look forward to jacking into the Matrix.
  • I mean, Comcast used to let me call this actual American person that would order a movie for me... I usually got the person because I owed them money, but then she'd put my film order in...

  • by Anonymous Coward on Monday July 20, 2009 @05:16PM (#28762101)

    It sounds like all this guy does is set up ponzi schemes and then the state shuts him down, the circuit court rules that he must pay fines, but all he does is move on to the next ponzi.

    So, where do I sign up and give him my $70?

  • Do we also get access to their warehouse of super-low-priced items but for a 1000%-off discount if we refer 10 people too? I read the article up until the part where it is revealed that one of the masterminds behind this sch-- operation was recently convicted of fraud.
  • Phantom phone? (Score:5, Interesting)

    by interkin3tic ( 1469267 ) on Monday July 20, 2009 @05:18PM (#28762133)

    Does this remind anyone else of the phantom. [] An electronic device that sounds too good to be true gathering investment money, the people who were supposed to be developing the thing have "offices" which are not really there.

    Of course in this case, one of the guys involved already has a record. At least with the phantom no one was outed as a known fraudster beforehand.

    I'm guessing that in 10 years, Zer01 will come out with a handy device to hold your phone up to your ear for you.

  • by fuzzyfuzzyfungus ( 1223518 ) on Monday July 20, 2009 @05:28PM (#28762305) Journal
    How, on the one hand, society makes it ever harder to escape your past(even shit entry level jobs can come with background and credit checks, never mind trying to get cleared, or the whole sex offender registry thing) while, somehow, certain people just seem to float right through, skipping from one scam to another, seemingly impervious.

    I wonder how it works. Is it the charm that sociopaths are known for that allows certain people to do it? Are the rules different in certain areas? Are most of the barriers actually illusory/psychological? Why doesn't an attempt to legally incorporate a new business include a "do any of your officers have a background in crime, particularly white collar crime?" check?
    • by Animats ( 122034 ) on Monday July 20, 2009 @05:54PM (#28762635) Homepage

      Why doesn't an attempt to legally incorporate a new business include a "do any of your officers have a background in crime, particularly white collar crime?" check?

      That's a real problem. People barred from involvement in the securities industry keep slipping back in. Bar owners barred from holding a liquor license often end up doing some deal as a "silent partner".

      I get complaints from "web businesses" who want to operate anonymously, because SiteTruth [] down-rates them for that. (It's a criminal offense to run a business anonymously in many jurisdictions.)

      • by Anonymous Coward on Monday July 20, 2009 @06:36PM (#28763065)

        I kept hearing things about some site called "Google", so I tried running it through SiteTruth. Turns out it's some shady, fly-by-night company. Phew! Glad I had SiteTruth to warn me.

        • Re: (Score:3, Insightful)

          by CAlworth1 ( 518119 )
          Even better, try entering - apparently they aren't too sure about themselves...
        • by Animats ( 122034 ) on Monday July 20, 2009 @11:56PM (#28765733) Homepage

          I kept hearing things about some site called "Google", so I tried running it through SiteTruth. Turns out it's some shady, fly-by-night company.

          Yes, Google is in the doghouse again. [] Google is hosting some phishing sites, which were reported to PhishTank. SiteTruth blacklists any domain with a hit in PhishTank. On any given day, about 50 to 100 well-known domains (out of the 1.5 million in OpenDirectory) are on the blacklist, [] generally because of sloppy security. Microsoft, Yahoo, and eBay used to be on the phishing blacklist, but after some nagging by us and The Register, they've mostly plugged the security holes involved. The blacklist is updated every 3 hours, so companies that clean up their act quickly don't stay on the list for long.

          Domains on the blacklist are usually 1) free hosting services, 2) URL redirectors like TinyURL, 3) DSL providers with weak abuse departments, and 4) sites with a software bug that lets other sites use them as a redirector. Some companies in those categories are good at quickly cleaning out such abuses; others just don't seem to care. In each category, there are plenty of companies who don't have such problems, so there's no reason to give anybody a free pass.

          It says something about a company's abuse department if they're on that list for more than a day or two.

    • by durdur ( 252098 ) on Monday July 20, 2009 @05:55PM (#28762651)

      A lot of crime floats under the radar. If you've been scammed out of a few hundred bucks, you can try getting the police interested but likely they won't be. Better to take the guy to small claims court, if you can find him to lay a summons on him. Eventually if somebody scams enough people out of enough money they may rise out of the general level of scum up to a point where law enforcement will get interested. But it takes a while, and some people manage to avoid consequences for a good long time. It's a little harder if you're a corporation and have to be or look semi-established, but there's still inertia/time lag before you get noticed and somebody decides they have a case against you. Look at ZZZZ Best.

      As for business licensing requiring a clean slate - even if this were a good idea, the guys who take your money and give you a license are bureaucrats, not cops. And you don't pay them enough to have them check everybody who comes in the door for past misdeeds.

      • by linzeal ( 197905 )

        Look at law enforcement. Through citizen measures the modern police force is trained to deal with 4 kinds of crime.

        1. Drugs from massive increases in the war on drugs to mandatory sentences. Most of the cost of sentencing those criminals will be paid back into the pockets of jailers, administrators, judges, cops and other industries that feed, cloth, and charge 20 dollars a phone call to a 50 year old man incarcerated for half of his adult life for doing drugs.

        2. DUIs and Traffic Enforcement. This is big

  • Contempt of Court (Score:2, Insightful)

    by Anonymous Coward

    Just throw the CEO in jail already...

  • by Locke2005 ( 849178 ) on Monday July 20, 2009 @05:35PM (#28762399)
    Enzyte [], despite the conviction of the founder and his mom for fraud, is still in business. They are still heavily advertising on TV, and apparently they are expanding and hiring. So there doing quite well for a company whose business model was proven unlawful in court.
    • So? Who needs the damn gubernment? The invisible hand of the free market will come and smite these foul fraudsters once the general public has been informed about their terrible misdeeds!

      Oh, wait. The general public is far too busy watching American Idol to constantly inform themselves about the gazillion jerks out there scamming (somewhat)honest people out of their money.

  • Too good to be true (Score:3, Interesting)

    by xpro42 ( 1234496 ) on Monday July 20, 2009 @05:36PM (#28762409)
    I'm glad to see this story on slashdot. I've been following it since early June when I first heard about this service from a random guy at an oil change shop in a small town in MS. My first thoughts when I heard the HD movie in 3 minutes was yeah and I got a bridge to sell ya. Then a week later I saw the same service being advertised on a game server in the FPS I play. The guy advertising it was all the way up in Canada. I thought to myself, wow if this is a scam they've got a lot of people suckered in already. This service was suppose to go live on July 1st; however, that date got pushed back to mid-August last I checked. My instincts all scream that this is a scam, especially about the bandwidth. I noticed that on the buzzirk page they have removed the claim of offering 180 Mbps. It was there last month, but not now.
  • by TheModelEskimo ( 968202 ) on Monday July 20, 2009 @05:36PM (#28762411)
    Is this one of those multi-level marketing (a.k.a. pyramid) schemes? I cannot WAIT for my neighbor with the jacked up Humvee to scrape the "MONA VIE" crap off his back windshield and replace it with a bunch of l33t h4x0r jargon. :-)
    • Re: (Score:3, Funny)

      by homer_s ( 799572 )
      Is this one of those multi-level marketing (a.k.a. pyramid) schemes?

      Nope. Their model is a trapezoid - much more stable.
    • Is this one of those multi-level marketing (a.k.a. pyramid) schemes?

      While they're similar, and MLMs attract scammers and workarounds to convert them, MLM and pyramid schemes are distinct.

      In a pyramid scheme, all or part of the cost of joining up becomes income to the members of the path through the pyramid above the new member. In a MLM, only part of the price paid for the sales of actual products is raked off. (Think of a MLM as a manufacturer-wholesaler-retailer network with the wholesaler (and his cut)

      • by DavidTC ( 10147 )

        Or, to phrase it another way, almost all pyramid schemes are hiding as MLMs.

        Which obviously does not make all MLM pyramid schemes.

        The real distinction is if the entire thing costs money to people who join.

        I.e., if I sign up, for free, and get paid 5% for each sale 'made by me', and if I sign up others up and get 3% for each of their sales, etc, that's a legit MLM. (And, in fact, an entirely reasonable way to run a referral service, although most places now just make a flat one-time payout of X dollars wh

  • by e9th ( 652576 ) <> on Monday July 20, 2009 @05:52PM (#28762607)
    Last March, Ars Technica wrote: []

    Zer01 says it can offer unlimited cell calls (via VoIP) and cell data through a unique relationship with AT&T. AT&T isn't talking, and the particulars of the deal fly in the face of similar virtual mobile network operator deals past and present.

  • by snspdaarf ( 1314399 ) on Monday July 20, 2009 @05:53PM (#28762629)
    Interesting that he can get salespeople to pay him to work for him. All that crap they taught me in school about wages and salary obviously was backwards.
    • by Lumpy ( 12016 )

      Dude, what they taught you in college is wrong.

      There are 3 facts to life.

      1 - there is always someone trying to scam you.
      2 - If it's too go to be true, then it is.
      3 - There is a new sucker born every minute.

      The world is full of suckers and the stupid. I know of Doctors that were stupid enough to send $20,000US to some dip in Africa for a piece of some BS scam they are trying this week.

      Humans are stupid, if you can attach any greed to it, they become 20X stupid than they were before you mentioned money.


      • Well said -- If I agreed with you anymore, I suspect we would cease to be differentiable least here on /.

      • by tompaulco ( 629533 ) on Monday July 20, 2009 @07:44PM (#28763757) Homepage Journal
        Fundraising organizations that help schools, churches, etc raise money for projects are equally as bad as MLM. They are essentially getting FREE labor, and not paying into Social Security, Medicare, providing benefits or anything. Many times the schools have to pay up front for a certain amount of product, and if they don't sell it they are stuck with it. There is almost no risk for the fundraising organization while the school or Church or whatever shoulders most of the risk or shares the risk with the parents of the underage labor pool. Meanwhile, the corporate campuses of some of these outfits are just insanely lavish and huge. Their only real cost of business is sending people out to beat the drums at the schools and churches.
      • by maxume ( 22995 )

        I still have night terrors from Devos's gubernatorial campaign.

        I did derive a certain amount of enjoyment watching his well funded confidence go to pieces though.

  • by Bookem Danno ( 84959 ) on Monday July 20, 2009 @05:59PM (#28762693)

    You don't want me to sign up so that when it turns out to be AWESOME later on, you can get 10$/mo for referring me.
    I'm on to your scheme, I WILL BUY A DOZEN!

  • scams and profit (Score:2, Insightful)

    by tommyatomic ( 924744 )

    Rarely do fake pyramid scam companies collect real income in a recession with the increasing number of sufficient savvy consumers increasing. Therefore they must get their employees to pay the company instead of paying their employees. Its a law of reverse proportions scams (I made that law up).

    Step 1 Create fake miracle product.
    Step 2 Hire employees as product advocates swearing by the awesome majesty of imaginary hardware/service.
    Step 3 Convince employees to pay employer instead of being paid themselves.

    • Re: (Score:3, Insightful)

      by nietsch ( 112711 )

      The trick is to scam the scammers. Find other 'salespeople' and give them enough hints that this may be a profitable scam. Paying to get in is a subtle trick to get your salespeople more commited (they already have something at stake) and to give them the impression they can really make some serious money with this. Somebody must have done the maths on this after all? (yes, and those people politely decline...)

  • I already give all my money to Amway Global :(
  • Cricket Wireless [] is similar, established, and without the pyramid deal. Their service is splotchy at best outside of urban areas. But $40 for unlimited wireless via USB, or $35 for unlimited long distance and text. My understanding is they buy obsolete towers from other companies, and work on older networks with older phones. Still, $35 unlimited everything beats the hell out of the fully nationwide providers, if you tend not to travel across rural areas.

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