Verizon, Google said to be nearing deal on net neutrality

Verizon (NYSE:VZ) and Google are negotiating a deal on net neutrality--though the agreement would not apply to its wireless network--according to multiple media reports.

The news about a potential deal comes amid a flurry of meetings among the FCC and stakeholders like Verizon and Google, as well as AT&T (NYSE:T) and the Open Internet Coalition, in a bid to forge a compromise on net neutrality. While any deal between Verizon and Google would affect only those two companies, it could have broader ramifications for other telecom, wireless and Internet companies. It could also influence lawmakers drafting legislation to tackle net neutrality.

The CTIA has argued that net neutrality rules should not be applied to wireless networks, and that the network architecture and capacity constraints of wireless are fundamentally different from wired networks.

Details about the Verizon-Google proposal remain murky at best, though some reports have said that a deal could be announced as soon as Friday. Additionally, there are conflicting reports about what the deal involves. According to Bloomberg, the deal would forbid Verizon from selectively slowing down Internet traffic on its wired lines. According to a New York Times article, the deal will allow Verizon to speed up some Internet content if the content's creators pay more. Both Verizon and Google have disavowed the NYT article.

The companies--which were initially on opposite sides of the issue but have since worked more closely--are hoping the agreement could provide the legislative framework for an industry-wide deal on net neutrality. On the wireless side of things, Verizon and Google last year formed a powerful partnership promoting Google's Android platform.

"We have been talking to Verizon for a long time about trying to get an agreement on the definition of what net neutrality is. We're trying to find solutions that bridge between the hardcore net neutrality view and the telecom view," said Google CEO Eric Schmidt, according to GigaOM. "The issues of wireless vs. wireline get very messy because of the issue of Type I vs Type II regulation and that is an FCC issue not a Google issue."

The FCC has been considering reclassifying broadband as a Title II , common-carrier service. That would clear the path for the commission to move forward on net neutrality. The FCC approved draft net neutrality rules last fall, but its plans were thrown into limbo after a federal court ruling in April questioned its legal authority over broadband. Many lawmakers, including many Democrats, have urged the FCC to hold off on the reclassification and wait for Congress to clear up the confusion via updates to telecommunications law.

"We've been working with Google for 10 months to reach an agreement on broadband policy," Verizon spokesman David Fish told FierceWireless. "We are currently engaged in and committed to the negotiation process led by the FCC. We are optimistic this process will reach a consensus that can maintain an open Internet and the investment and innovation required to sustain it. " A Google spokeswoman declined to comment.

Jen Howard, an FCC spokeswoman, told FierceWireless that "the broad stakeholder discussions continue to actively include Google and Verizon."

AT&T said in a statement that it was not part of any deal between Verizon and Google. "We remain committed to trying to reach a consensus on this issue through the FCC process," an AT&T representative said. 

Meanwhile, public interest groups pushing for net neutrality regulations--groups that have not been involved in the FCC's closed-door negotiations on the topic--lambasted any potential deal between Verizon and Google.

"The deal between Verizon and Google about how to manage Internet traffic is deeply regrettable and should be considered meaningless," Gigi Sohn, the president of Public Knowledge, said in a statement. "As a legal agreement, it is not binding on either company. As an agreement in principle, it should not be taken as a template or basis for Congressional action.The fate of the Internet is too large a matter to be decided by negotiations involving two companies, even companies as big as Verizon and Google, or even the six companies and groups engaged in other discussions at the FCC on similar topics."

For more:
- see this GigaOM article
- see this Bloomberg article
- see this WSJ article (sub. req.)
- see this NYT article
- see this Verizon blog post
- see this Washinton Post article

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