Verizon Wireless and Google this morning surprised the wireless mobile industry when it went far beyond a much-anticipated agreement between Verizon and Google to market smartphones using Google’s Android operating system, and instead seemed to embrace Net Neutrality for unrestricted use of online services on Verizon Wireless’ network.  Is this a consumer-friendly about face or a strategic effort to take the wind out of the sails pushing for formal adoption of Network Neutrality regulations?

Today’s announcement represents a complete reversal for Verizon Wireless, which announced opposition for wireless Net Neutrality in September.  Tom Tauke, Verizon’s executive vice president of regulatory affairs said then: “We believe that when the FCC reviews the record and looks at the facts, it will be clear that there is no current problem which justifies the risk of imposing a new set of regulations that will limit consumer choices and affect content providers, application developers, device manufacturers and network builders.”

Google and Verizon have been on opposite sides of the Net Neutrality debate for several years now.  The phone company spends millions of dollars lobbying Washington to keep Net Neutrality off its back, in direct opposition to Google’s strong advocacy for the consumer-friendly open network rules.  One might anticipate a joint webcast between the two companies would be reserved in tone at best.

It wasn’t.

In fact, Verizon Wireless CEO Lowell McAdam and Google Chairman and CEO Eric Schmidt fell all over themselves praising one another, and attacked Verizon’s nemesis AT&T.

McAdam took a shot at AT&T for the recent controversy over their decision to block Google Voice and other Voice Over IP services from working with AT&T’s wireless network.

“Either you have an open device or not. This will be open,” McAdam said.

Schmidt praised Verizon Wireless’ nationwide mobile broadband network, calling it “by far the best in the United States.”

AT&T understood the implication of the partnership between its biggest rival and the super-sized Google and announced it was reversing its decision to block Voice Over IP applications on its network.

Ralph de la Vega, chief executive of AT&T’s consumer wireless unit, said “the iPhone is an innovative device that dramatically changed the game in wireless when it was introduced just two years ago.  Today’s decision was made after evaluating our customers’ expectations and use of the device compared to dozens of others we offer.”

That’s a remarkable statement coming from a company that has routinely ignored the wishes and expectations of its iPhone customers for less expensive, higher quality, less restrictive service.

AT&T’s reversal was praised by FCC Chairman Julius Genachowski, who is pushing for adoption of Net Neutrality as part of FCC broadband policy.

“When AT&T indicated, in response to the FCC’s inquiry, that it would take another look at permitting VoIP on its 3G network I was encouraged,” Genachowski said. “I commend AT&T’s decision to open its network to VoIP. Opening wireless services to greater consumer choice will drive investment and innovation in the mobile marketplace.”

Have AT&T and Verizon suddenly realized taking a customer-friendly position of Net Neutrality is better for their corporate image?

Perhaps, but one might also consider the reversals to be part of a strategic effort to demonstrate a lack of need for Net Neutrality rules in a ‘remarkably open and free competitive wireless marketplace.’  Expect to see that line or something akin to it coming from the anti-Net Neutrality lobbying campaign within hours of today’s events.

AT&T has also spent millions on lobbying efforts in Washington to keep Net Neutrality and other telecommunications legislation at bay.  The prospect of a sudden role reversal for two of the biggest spenders on influencing public policy would be remarkable, if it actually happened for consumers’ sake.

Verizon Wireless & Google Joint Webcast — October 6, 2009 (18 minutes)
You must remain on this page to hear the clip, or you can download the clip and listen later.

From the Department of Duh:

The plight of mobile providers to strike profit riches in mobile broadband has been stymied by the fact customers actually want to use the service they pay for each month.

Even worse, customers are using dongles to give their laptops and netbooks wireless connectivity, which hurts an industry accustomed to charging top dollar for data plans used sparingly on cumbersome mobile phones.

“Dongles really are reaching a critical mass,” a Vodafone spokesperson told BBC News.

French operator SFR claims laptops equipped with a dongle use 450 times more bandwidth than a classic mobile phone.

So-called “smartphones,” which often include a built-in or on-screen keyboards, are using lots of data, too.

The result has been near-universal adoption of usage caps in European mobile broadband, which UK operator O2 admitted earlier this year were “used as a deterrent and to make sure that others using the network had a good experience.”

Many providers have customers too afraid to exceed those caps, often set at 1-5GB per month.  The punitive overlimit fee can easily add tens of Euros to mobile broadband bills.  Many customers stay well clear of the cap to avoid the prospect of receiving a shocking bill.

Providers fear their mobile networks may soon be at capacity.  That would logically lead many to presume fast and furious investments in their networks to upgrade capacity, but that is exactly the opposite view some providers have.

“You can easily lose money on mobile broadband if you do it in the wrong way,” warns Bjorn Amundsen, director of mobile network coverage at Telenor in Norway.

“We have had to be careful not to invest too much, because the only thing that would happen if we did would be to increase data traffic without an increase in our profits,” said Amundsen.

Phil Sayer, principal analyst at Forrester Research told the BBC, “the user community as a whole is tired of hearing special pleading from the mobile operators.”

“Remember, these guys have been making money hand over fist from data roaming charges,” Sayer said.

Cricket has a nasty habit of selling customers an unlimited mobile broadband service… that is limited to 5GB of usage per month.  Today, the company announced it would be expanding its prepaid wireless broadband service to “big box” retail stores nationwide:

Cricket Broadband will soon be available in nearly 1,000 national retailer stores through a new all-inclusive $50 monthly service plan. The new plan will include all fees and taxes and provides unlimited Internet access without a signed contract or credit check. The Cricket A600 modem will be available as a grab-and-go offering for $69.99 with no activation fee. $50.00 top-up cards will also be available for this product.

The marketing on their website underlines the point: “With unlimited broadband access you can email, surf and download from your desktop or laptop anywhere in Cricket Broadband’s coverage areas.”

“Unlimited” in their marketing is actually “5GB” in the nitty-gritty details on their website as you sign-up:

Subscriber Management
We reserve the right to protect our network from harm, compromised capacity or degradation in performance. We reserve the right to limit throughput speeds or amount of data transferred, and to deny, modify or terminate service, without notice, to anyone whose usage adversely impacts our network, service levels or uses more than 5 GB in a given month. We may monitor your compliance with the above but will not monitor the content of your communications except as otherwise expressly permitted or required by law.

Cricket needs to discontinue the practice of referring to a service as “unlimited” when it isn’t unlimited at all.  Cricket is also well aware of the 5GB limitation, because it is currently testing a 10GB plan priced at $60 a month.

Cricket has also applied for federal broadband stimulus funding to provide service to low income residents:

Low-income residents in San Diego County who can’t afford Internet service may get some financial help if a local wireless provider succeeds in getting more than $8 million in federal stimulus funds to expand broadband access.

San Diego-based Cricket Communications said yesterday that it has applied for federal Recovery Act funding geared to expanding high-speed Internet access not only in more remote rural areas but also to the urban poor.

Cricket is proposing a $10.7 million program to provide subsidized, low-cost Internet service to 23,000 low-income families in San Diego, Baltimore, Houston, Memphis, Tenn., and Washington, D.C.

Under the proposal, the federal government would cover 80 percent of the cost, with Cricket picking up the remainder. Cricket, a wholly owned subsidiary of Leap Wireless International, is working with One Economy, a Washington, D.C., nonprofit, to help it reach out to low-income households.

In addition, it plans to substantially discount its normal monthly service of $40 so that participants would pay $5 a month the first year and $15 a month the second year. The grant would cover two years of subsidized service.

As for Cricket’s new broadband plan, I’m unsure what’s new about it.  It appears to be priced $10 higher than the old $40 Cricket plan (that comes with a $25 activation fee).  The A600 modem is available for free after rebate from the Cricket website, and the service price there remains $40 a month, although “taxes and fees” are extra, which may account for the primary difference between the two plans. Cricket appears to be moving to “all-inclusive” pricing strategies, which means the price you see is your “out the door” price. Many consumers are shocked when signing up for a mobile phone service that is advertised at one price, and turns out to be considerably higher once taxes and fees are included on the bill.

The A600 offers average download speeds of 538 kilobits per second (Kbps) and peaks at 787 Kbps. The average upload speeds offered by this modem are of the order of 502 Kbps, according to a PC Magazine review.

[Update 9/22: A response from Zocolo Group on behalf of Cricket can be found in the comment section of this article.]