While I think the deal stinks, I still can't be too hard on Google. It appears they got as much out of Verizon as they could and settled for a fundamentally flawed agreement.

There has been a veritable maelstrom on the Web in the past week over the joint "Verizon-Google Legislative Framework Proposal" on 'Net Neutrality. The carriers (like Verizon) have not endorsed Net Neutrality and for the most part have held that it is unneeded and potentially counter-productive. Google, whose entire business model is predicated on the idea of open access, has been the strongest and most vocal proponent of the principle that user access to the Internet should not be hampered by restrictions imposed by Internet Service Providers or governments on content, sites, platforms, or the kinds of equipment that may be attached or the modes of communication allowed.

In what was seen as a breakthrough, Verizon and Google agreed on basic consumer protections, non-discrimination and transparency requirements for Internet providers, and identified the FCC as the exclusive regulatory authority over Internet access. That regulatory authority would not extend to "software applications, content or services". They did allow for the carriers to provide differentiated services in addition to open Internet access, which is apparently a green light for things like MPLS VPNs.

The major concession in the proposal is that 'Net Neutrality would not apply to wireless networks, so the most important developing network was left out of the pact (wireless carriers would have to adhere to the "transparency" requirements however). The Electronic Frontier Foundation and various pundits voiced varying degrees of displeasure with the agreement, and all took exception to the exemption for wireless.

The din grew so loud that Google's official mouthpiece, Richard Whitt, Washington Telecom and Media Counsel, posted a response answering their critics. In refuting the "myth" that Google's proposal would eliminate network neutrality over wireless, Mr. Whitt appeared to be taking the wireless line.

Specifically he made the case that the wireless market is more competitive than the wireline market, given that consumers typically have more than just two providers to choose from. Yeah, we have four, but two of them probably aren't worth talking about, and they all adhere to the same restrictive business plans. That's like trying to argue that the old USSR really was a democracy.

He also noted that since wireless networks employ airwaves rather than wires, they share constrained capacity among many users. That is true, but cable modem systems also employ shared access channels, and all capacity is constrained by physics (remember Shannon's Law?). When you get right down to it, everything in the Internet is shared. The "poor, poor pitiful me" argument isn't holding much water.

Finally he notes that network and device openness is now beginning to take off as a significant business model in this space--okay, the spaceship has just exited earth orbit. Virtually 100% of mobile device sales are tied to carrier contracts. Competition in the wireless market has now shifted to devices, and the carriers fight tooth-and-nail to secure exclusive distribution agreements for hot handsets (read "iPhone"). Those exclusive distribution arrangements are then used to rope customers into long-term contracts. That whole model is predicated on lowering out front costs and is geared toward consumer versus enterprise customers.

Google is certainly trying to push that open device model with Android, but we have seen nothing that would indicate any change in the carriers' operating model. If anything, they're digging in their heels against 'Net Neutrality as they see the inevitable end game where they actually have to become simply carriers and no longer have a role in arbitrating the interesting part of the mobile market which is the devices.

While I think the deal stinks, I still can't be too hard on Google. It appears they got as much out of Verizon as they could and settled for a fundamentally flawed agreement. They do hold out hope of reaching better terms further down the road, and they hold up Clearwire's open 4G WiMAX model as an indication of better things to come.

In the long run it's inevitable that wireless services will migrate to the same core IP technologies as the wired Internet (that is the core of the aforementioned 4G migration with both WiMAX and Verizon’s preferred LTE technology). When that change occurs wireless IP voice services and all of the enhanced unified communications capabilities we have seen in the wired network will burst loose in wireless. In the meantime, we'll just have to keep pecking away at the wireless bastion one brick at a time.