Walled Garden, Not Going Away

Fred Wilson’s assessment of the YouTube-Verizon Wireless deal is spot on. The limited amount of YouTube inventory over Verizon wireless network and devices, “violates the entire ethos of YouTube, not free, not open, exclusive, no community, limited, censorship, etc, etc.” The likelihood of such a deal has been talked about for a while.

Despite Verizon network’s superior quality, I refuse to subscribe to them, because their (deck) interface, regardless of the phone, is the mobile equivalent of Chinese water torture.
The thought that Verizon would decide what YouTube video gets shown on the mobile makes me shudder. (For better options, we have some recommendations for you, which are more fun, to say the least.)

Steve and Chad need to answer one more question: Verizon is making money from the network; YouTube is likely profiting from this deal, but are they sharing the goodies with folks whose videos will end up on Verizon handsets?

The agreement shows that the wireless carriers will continue to maintain an iron-fist like control over their networks; showing the cunning of a Night Club bouncer, deciding when and who is allowed to cross the velvet rope. When a brand as big as YouTube has to fall on its knees and play ball with Verizon (on carrier’s terms), what chance do others have?

Frankly, that is not going to change. The utopians are looking at 3 X-Series as a sign of a revolution, though in the end it might be a simple mutiny by a company, whose financial quandary might have something to do with its decision to break ranks with the global mobile oligopoly.

The Silicon Valley folks have complained bitterly about this exclusive strategy. “I think it’s inevitably just a matter of time before general IP and open protocols get to mobile phones,” Reid Hoffman, CEO of LinkedIn said at a recent event at Oxford University’s Said Business School. “I think a lot of people in Silicon Valley are agitating to work out ‘how do we take the dam down faster?'”

Others like Matt Cohler of Facebook and Chris Sacca of Google expressed similar frustration, but complain as they may, in the wireless world their network neutrality, open network argument is not going to fly. Given the billions of dollars they spent on spectrum, and building those networks, carriers want to milk their profit machine as much as they can.

The walled garden will remain just that – albeit with heavily barred windows.