A new wireless carrier is launching today, it's called "Zact" and though it's piggybacking on top of Sprint's wireless network, the company swears up and down that it's not an MVNO (Mobile Virtual Network Operator). Zact's goal is to out-T-Mobile T-Mobile as the "Uncarrier" by offering no-contract service plans that are customizable to an incredibly granular level. It's a compelling idea in a sea of restrictive and annoying service plan options — but for now it's probably only going to appeal to the traditional pre-paid customer.
Zact is offering two low-end Android handsets for sale at un-subsidized prices: LG Viper 4G LTE for $399 and LG Optimus Elite for $199 — both running older versions of Android. These devices have special software built deeply into the OS that allow them to dynamically change your service plan on the go. You pay a flat fee of $4.99 per-device, and then choose your minutes, texts, and data packages as you need them. You can select amounts down to very specific levels — the typical "steps" between plans range in the dollars and cents instead of in the tens of dollars.
Good plans, terrible devices
The idea is that you only need to pay for what you're actually going to use as you use it, and Zact will refund you for whatever you don't use at the end of the month. In theory, this can result in radically lower bills — or at least bills that accurately reflect your actual usage instead of your best guess. As you use your phone, an app will pop-up as necessary for you to add more minutes or data — or you can modify it whenever you like.
Zact also allows for incredibly discrete parental controls — you can manage another device on your plan directly from the phone and disallow data, texting, and even app usage for other devices. Zact is also offering ways to get app-specific plans: if you'd like to get an email plan or a Facebook plan instead of a generic data bucket, you can do that. The features all come thanks to Zact's deep integration with Android, which allows them to recognize which apps are trying to launch or use data and whitelist or blacklist them as appropriate.
If it sounds confusing, that's probably because it is at first
If it sounds confusing, that's probably because it is a little confusing — at least to people who are used to more traditional plans with big buckets of minutes and data. CEO Greg Raleigh believes that the new pricing model should become the new standard. T-Mobile's Un-Carrier plans were "a good kind of half-step," Raleigh says, "but at the end of the day what it is really? It's just a rebanding or remarketing of the no-contract concept."
The company behind Zact is called ItsOn, and Raleigh insists that the service that powers Zact isn't the same thing as a traditional, pre-paid MVNO. "An MVNO would take the same box as the carrier would buy and then create a network with the same offers. That is not what we do, we have a virtual service that has 10 times the flexibility," he says, "I would not spend my time on an MVNO."
"I would not spend my time on an MVNO."
That may indeed be true from a technical perspective, as Zact doesn't need to build out the infrastructure that most MVNOs do, but the end result for consumers will essentially be the same — the company currently only offers low-end Android devices dependent on Sprint's largely-3G network. However, Raleigh notes that ItsOn will announce "top tier carrier deals" later this year, offering the same flexible plans. Theoretically, Zact could also offer higher-end Android phones as well, Raleigh says that the custom software necessary for Zact to work is compatible with Jelly Bean.
Until then, Zact is meant to be a "lighthouse," as Raleigh puts it. Raleigh's goal is to prove that consumers can save money (an average of $1,126 over two years, the company claims) without carriers losing profits. It's a lofty goal, but the thing about lighthouses is that they tend to get abandoned if no ships sail into their waters.