Zer01 Fails To Deliver Again; Blames Everyone Else, Dumps Buzzkirk, Threatens Legal Response To Reporters

from the well,-let's-see-now dept

Last month, following an excellent investigative report by Nancy Gohring on a hyped up mobile service company called Zer01, our own Derek Kerton weighed in with his own findings about the company. It all added up to an awful lot of questions. There were numerous claims that were not substantiated. Promises that were not lived up to. Business partners with troubling histories. And a whole lot more. One of the many questionable aspects of the story was Zer01's relationship with Global Verge, a multi-level marketing company that had signed up a bunch of people to sell the service, which resulted in totally ridiculous claims about the service. Some of those who had bought into the Global Verge/Buzzkirk plan were still peppering our comments last week with promises of amazing wealth to come.

But, the story keeps getting worse. Last week, Laptop Magazine, whose "best of show" award at CTIA the company had been leveraging for credibility, rescinded the award, noting not just the questions raised by the various reports, but also Zer01's own promise to deliver them a working phone weeks ago. It's been a week and Zer01 still hasn't taken down the award from its website, where it's prominently placed and promoted. Oops. But, a much bigger deal was that the company, once again, promised to start shipping the phones August 10th and to start paying the "sales commissions" to all those people who "earned" them via the MLM plan. Of course, the week's almost over and no phones yet... Update: to be clear, these statements were made by Global Verge, but considering that they were the official marketing partner of Zer01, you have to think they would not promise delivery of the phones had Zer01 not told them they were ready. Besides Zer01 has also been promising phones to people for weeks.

On top of that, Gohring has continued to dig into the story and reports that Global Verge appears to have fired a bunch of execs, including the one who was promising that the phones and commissions would be delivered this week. Now that he's no longer working there, he says that "it'll be a miracle" if they actually pay the commissions. There are also lots of questions about the supposed "reasons" for the delay. One exec claimed the SIM cards need to be "defragged," though a SIM card expert Gohring spoke to had never heard of "defragging" a SIM.

But this morning, the story got even more odd. First, Zer01 blasted out a press release announcing that it had dissolved the relationship with Global Verge. I'm not quite sure what that means for all those "associates" who have paid up a bunch of money, but I'd bet it means despite their eager insistence, they won't be seeing those phones any time soon.

From there, however, Zer01 uses the press release to bash everyone who has been reporting on this story and to threaten legal action against all of us:

During the three-month business relationship between Zer01 Mobile and Buzzirk Mobile, questions by the general public and journalists were raised about the business agreement and Buzzirk Mobile's ability as a distributor. "Overall, there were a number of news articles and blogs that misreported a lot of the facts about each company and its services," commented Ron Dresner, Zer01 Mobile spokesperson. First, Zer01 Mobile and Buzzirk Mobile are two very separate and distinct companies, only joined by this now dissolved agreement. Previous reports erred in applying facts about the questionable background of Buzzirk Mobile executives to Zer01 Mobile team members; Second, industry 'insiders' commented about the new Zer01 Mobile service stating their doubts about the credibility of the service because no details about the interconnect agreements were released. From the start, Zer01 Mobile stated that it needed to protect and honor the confidentiality of its business partners and could not release this information. It has invited any and all industry 'insiders' to visit with Zer01 Mobile at any of the upcoming industry conferences and use a Zer01 Mobile phone; Third, Zer01 Mobile has never promoted or mentioned facts regarding its service that were misleading. News reports specifically quoted Buzzirk Mobile sales associates sources as to communication speed rates and frequencies; and fourth, questions about Zer01 Mobile's patent pending technology in the news are totally unfounded and motivated by marketplace competitors. Any visit to the patent office will prove Zer01 Mobile's VMC technology registration."

"We hope that our actions and statements put many concerns to rest. We believe that statements made publicly about the nature of our relationship with certain entities and the legitimacy of our mobile products by certain third parties are erroneous and untrue and are not based upon sufficient knowledge of the facts involved. Currently, our counsel is in the process of preparing a response to these false and misleading statements. Our company reserves all its legal rights and remedies that may arise from any and all erroneous and untrue statements made by third parties. We consider the reputation and integrity of Zer01 Mobile to be of utmost importance to our future success and we intend to vigilantly defend it," concluded Dascotte.

Well, well, well. So it seems that part one of the plan is to throw Buzzkirk/Global Verge under the bus. That's a good step -- though they haven't explained why it didn't happen back when the problems were first reported on. The rest, however, simply raises more questions. In mocking the so-called 'insiders' who are welcome to use a phone at any upcoming industry conference, it ignores the fact that Derek tried to do exactly that at CTIA and was not allowed. It also doesn't explain why it's failed to deliver promised test units to reporters like those at Laptop magazine. If the phones really are ready, why are they only ready at trade shows? In another part of the press release, Zer01 insists the reason it can't explain its wireless network agreements is due to confidentiality agreements. That's nice... except that the two national GSM providers both have denied working with Zer01. Perhaps they have other agreements in place, but given all the other questions raised without answers, hiding behind "confidentiality agreements" isn't particularly convincing.

As for the patents, that's a nice dodge as well. First of all, it's quite easy to file a provisional patent, so we don't doubt that the company may have filed something. But we asked what that patent application was for, and notice that it doesn't respond. All it says is that we can find out if we visit the patent office. The thing is, the questions are on Zer01's side, and they could put this all to rest by actually showing the application to people.

Finally, if the company really believes that its reputation and integrity are of the utmost importance, rather than threatening reporters and industry folks who have questioned them, why not... um... actually prove them wrong? If Xer01 actually comes out with a phone and service that does what they promised it would do, it would be quite newsworthy, and we'd be more than happy to write it up and retract the earlier questions raised about the service. But attacking those who raised those questions -- which the company still hasn't answered, other than with its passive aggressive attacks in this press release -- we're still left wondering why the company won't actually answer those questions.

Filed Under: multilevel marketing
Companies: buzzirk, global verge, zer01