Wired has a long, detailed explanation of Google’s slide from protector of the Internet to Carrier-Humping Net Neutrality Surrender Monkey.
While most analysis has pointed out that the wireless part of the deal reeks, Wired also points out that the wired form of “net neutrality” that Googlezon proposes has a giant loophole that benefits the big ISPs. ISPs are free to offer exclusive services to their customers. So, ISPs (which are mainly cable companies) can offer a bundled, loss-leading video service to drive competitors like Hulu and Netflix out of the market. Once they’ve captured the market, they’re free to price video any way they’d like.
This is the same tactic that cable providers used with telephone and DVR. Cable providers bundled telephone service to make third parties like Vonage marginal players. Similarly, cable operators bundled their own DVRs and made it very difficult or impossible for TiVo to connect to their system.
It’s impossible for entrepreneurial companies to compete with bundling, and Google has become complicit with Verizon in an effort to keep bundling alive, all to get more eyeballs on mobile ads.