Technologizer

Zact: Build Your Own Wireless Plan, Down to the Last Detail

A wireless startup aims to let you pay for only the services you use -- down to the app-by-app level.

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Zact

When it comes to wireless service, every individual and family has different needs — and oftentimes, those needs vary from month to month. But you wouldn’t know that from the plans offered by the big U.S. carriers. Even at their most flexible, they just don’t offer enough options, and they generally encourage you to pay for more service than you actually need for fear of overages.

And then there’s Zact. It’s a new wireless provider which, judging from a demo I recently received, comes as close as any I’ve ever seen to providing absolutely custom service plans. Rather than making you choose from one of a few offerings, it lets you choose from lots of them — and then allows you to refine those options further until you’re paying for exactly the service you use. It’s like a purveyor of beautifully custom-tailored suits in a world of S, M, L and XL.

Zact’s service, which will be available next month, runs on Sprint’s network. But if you sign up, you’re a customer of a startup named ItsOn. Zact is ItsOn’s own consumer brand, but the company has built a software-and-service platform designed to let other companies provide similar offerings; if it’s a success, there could be many Zact-like services around the world.

Zact offers contract-free service, which means you pay full price for phones but can leave whenever you like without paying an early termination fee. In some broad respects, it’s reminiscent of other price-conscious alternative wireless providers which don’t own their own networks, such as Ting and Republic Wireless. But it’s doing multiple things which are genuinely new. For instance, it gives you so much control over the services you pay for that you can choose to use a particular app without splurging on a full-blown data plan. $5 a month will get you access to Facebook — and nothing else. $1 a month lets you play Candy Crush with friends. And so on.

More general-purpose options — voice, data and text — are available in multiple quantities, starting with parsimonious amounts at very low prices. (25 texts a month will run you 71 cents.) But unlike conventional carriers, which can leave you either paying too much for service you don’t need or getting socked with overage charges, Zact makes it tough to go wrong. You can top off your voice, text or data plan at any time, or upgrade to a higher-end (or lower-end) option on the fly. And if you don’t use everything you paid for as part of your monthly plan, you get a refund.

Kid-management features are one of Zact’s specialties. All plans are shareable among multiple handsets, and a parent can manage every phone associated with one Zact account from his or her phone. Mom or dad can choose who a child is allowed to communicate with and which apps are permitted — and can set up different rules for different times of day, so games are verboten during school hours, for instance.

All of this should permit a Zact customer to save money on wireless service. Maybe a lot of money: the company says that an average U.S. consumer would pay roughly $31 a month, which is one-third the average. It offers an online calculator to help prospective subscribers determine what they’ll pay.

So what’s the catch, assuming you’re O.K. with Sprint’s network, which is transitioning off of WiMax and still doesn’t have the LTE coverage of Verizon and AT&T?

It involves hardware. You need to buy a new phone to switch to Zact, even if you’re a Sprint customer. (The company enabled its features by writing Android software that’s deeply embedded into the operating system on the handsets it sells.) And for now, it’s only selling two models from LG — the Optimus Elite ($199) and Optimus Viper 4G LTE ($399). Neither is cutting-edge: the Elite runs Android 2.3 Gingerbread, and even the Viper is on Ice Cream Sandwich, not Jelly Bean.

Zact says that more phones from additional manufacturers are on their way. If the company gets hot models such as Samsung’s Galaxy S 4 or HTC’s One, it could appeal to an awful lot of people, assuming they’re willing to pay full price for a phone up front in return for sizable monthly savings thereafter. (I’d be astonished if Apple permitted the company to sell a Zact-compatible iPhone, but for what it’s worth, Zact founder and CEO Greg Raleigh didn’t discount the idea when I asked him about it.) For now, the company sounds like its natural customer base will be cost-conscious families who aren’t too hung up on getting a particular model of phone. That’s millions and millions of people right there, even if you and I aren’t among them.

Disrupting the mobile industry is no cakewalk, so I’m not assuming that what Zact is doing, as appealing as it sounds in principle, is going to be a big deal. But it would be pretty cool if caught on — especially if it scared the big carriers into pricing their services in a similarly efficient manner. Isn’t it a given that if consumers had a choice, and handset selection and network coverage weren’t issues, enormous numbers of people would opt to pay for wireless service the Zact way rather than the old way?

9 comments
wwaseem
wwaseem

Meh, this would have worked better if they were not CDMA; Made a mistake of going for a CDMA phone, never going that route again.

eagle11772
eagle11772

I pay now, and have paid for a few years, a flat $25 per month for 300 minutes of voice + unlimited text and web from Virgin Mobile.  I'll switch if somone can beat that price.

hossenfeffer01
hossenfeffer01

Given their ability to control access to various services I wouldn't be surprised to see roaming as a service plan adder like Facebook on for those who are limited.  

SirWired
SirWired

This is indeed pretty cool... I like the automated cost adjustment and the low-cost sharing.  (Although text heavy families won't find anything but unlimited texts to be very useful.)  However, I would like to point out that you didn't mention the $4.99/mo per-device fee.  (Plus regulatory fees?  Their website doesn't address those one way or another )

It's particularly impressive that they are pulling this off at these prices while providing roaming service.  Most pre-paid plans do not provide roaming, which is a HUGE limitation for Sprint Pre-Paid customers, like those on Virgin Mobile.

wwaseem
wwaseem

No, but you will probably be more productive with a better phone and a data connection that isn't dial up speees

hossenfeffer01
hossenfeffer01

@SirWired The $4.99/mo was a statement by the CEO in an article but not seeing it on the website either.  Went through the checkout process and didn't see this charge.  There is a $10 activation charge though.  Given then can control access to Facebook and other service plan adders it will be interesting to see if Roaming is a service plan adder they can control for those who are limited.  Since they are not a carrier, I would wonder if their agreement with Sprint to use data/text/sms/etc would include regulatory fees.       

eagle11772
eagle11772

@wwaseem The speed and functions work fine for me on this Samsung Intercept phone.  I don't want to pay a cent more than the $25 per month I pay for celfone service.  The only way I would switch is if I can get a plan less than the $25 per month I am paying now with an equal or better celfone.

SuperSam64
SuperSam64

@eagle11772 @wwaseem  You wouldn't consider a slightly more expensive plan that offers you a huge amount more value?  For example, T-Mobile's $30 a month smartphone plan that gives you 5 Gb  of data (which most people would have a hard time using up) and 100 voice minutes (which can be turned into nearly unlimited minutes by using calling over data).  I get what you're saying, that you're happy with that price and don't want it to increase, but to me, in this scenario, what you get is worth a lot more than the price difference.