Verizon Communications Inc. and Google Inc.
urged U.S. regulators to leave wireless Internet services outside most
policies that are designed to prevent carriers from making some websites
perform better than others.

The companies issued a "compromise proposal" for so-called
net-neutrality rules. The plan would restrict Internet service providers
from selectively slowing content that travels over their wires, but
wouldn’t apply such limits to Web use on mobile devices, according to a
blog post by the companies Monday. They would also exempt new offerings
beyond traditional Internet and TV services, such as health care
monitoring.

Google and Verizon argue that the mobile Internet market is more
competitive and changing rapidly, and therefore different from the
wireline market. Critics say the proposal would let Verizon and other
carriers discriminate against certain traffic, possibly favoring their
own services.

"This is exactly what net-neutrality supporters have feared all
along – an open door for Internet providers to control content
indiscriminately," said Josh Silver, executive director of Free Press, a
nonprofit group in Washington, D.C., focused on policy and the media.
"This is an attempt by Google and Verizon to self-regulate the same way
the banks did in the run up to the banking crisis."

Verizon and Google had been adversaries over the issue. New
York-based Verizon was among the cable and phone carriers saying they
need leeway on the delivery of Web content to protect performance of
their networks. Google led content providers and advocacy groups that
say restrictions are required so communications companies don’t favor
their own online offerings or those of partners that pay for higher
speeds.

Last week, U.S. regulators ended closed-door discussions with
companies on Internet regulation, saying they didn’t result in a "robust
framework" to preserve the openness of the Internet. Among participants
were AT&T Inc., Verizon, Google, Skype Technologies SA, and the
National Cable & Telecommunications Association, representing
companies led by Comcast Corp. and Time Warner Cable Inc.

The Federal Communications Commission negotiated with the companies
over rules proposed by Chairman Julius Genachowski to regulate how phone
and cable companies handle Web traffic such as Google’s YouTube videos.
Genachowski told reporters in Washington last week that any resolution
"that doesn’t preserve the freedom and openness of the Internet for
consumers and entrepreneurs will be unacceptable."

FCC spokeswoman Jen Howard declined to comment Monday.

Google and Verizon have become business allies through Verizon
Wireless, the largest U.S. wireless carrier. Mobile phones that use
software from Google, owner of the largest Internet search engine,
helped Verizon’s profit this year.

Earnings for Verizon beat estimates last month as its wireless unit
promoted phones running on Google’s Android software, including Droids
from Motorola Inc. and HTC Corp., to compete against AT&T’s iPhone
from Apple Inc.

Carriers such as Verizon, which have spent billions of dollars
building high-speed networks, are trying to affect the FCC’s policies to
be able to earn a return on their investments.

Google and Verizon’s exclusion of wireless services from the policy
proposal veers from the FCC’s principles, which don’t make a distinction
between wireline and wireless connections, said Sherwin Siy, deputy
legal director for Public Knowledge, a Washington-based consumer
watchdog for digital rights.

"There’s no reason the same rules of being fair and
nondiscriminatory shouldn’t apply in the wireless scheme as well," Siy
said. Preserving the success of Android is "certainly foremost in their
minds," Siy said.

Consumer Watchdog, a consumer group based in Santa Monica, said the
proposal "completely undermines the future of the Internet" because the
wireless use of the Web is gaining in popularity.