Update: Both Google and Verizon deny the talks.
Meanwhile Politico reports that the FCC has ended Net Neutrality talks.

Lazarus said the agency’s round of stakeholder meetings had not “generated a robust framework to preserve the openness and freedom of the Internet,” but he added, “All options remain on the table as we continue to seek broad input on this vital issue.”

If anything, Lazarus’s comments could signal the agency is ready to move ahead with its plans to use its own rule-making process to implement the so-called third way, a controversial plan to apply to broadband a series of rules that have long governed phone companies.

Genachowski declined to say earlier Thursday how the agency would next proceed and whether the commission would take up the "third way" proposal at its meeting next month.

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Via the New York Times, Google and Verizon are "nearing a deal" for pay-tiers on the web.

Google and Verizon, two leading players in Internet service and content, are nearing an agreement that could allow Verizon to speed some online content to Internet users more quickly if the content’s creators are willing to pay for the privilege.

The charges could be paid by companies, like YouTube, owned by Google, for example, to Verizon, one of the nation’s leading Internet service providers, to ensure that its content received priority as it made its way to consumers. The agreement could eventually lead to higher charges for Internet users.

This was the very thing that Net Neutrality proponents were fighting against.

Unfortunately, should this deal go through, it will be neutering the FCC (not that they had the cojones to do anything about net neutrality in the first damn place) from stopping a tiered pay system for internet content and stopping Internet service companies from blocking or slowing down content. The impact on small bloggers and small online businesses will be greatly impacted, not to mention the wallets of everyday users.

It will be a very sad day should this deal go through. Even sadder, this deal could greatly impact my other artsy blog, that has recently taken off, catering to a very small, very niche group (there are maybe a couple thousand people involved in this art form world-wide).

Before all is said and done, we the people have a chance to voice our opinions.

Chances are you’re holding your phone. Or it’s in your pocket, or at least within arms length. Wherever it is, grab it, and then dial 202 – 418 –1000 and ask for Julius Genachowski, chairman of the Federal Communications Commission.

Repeat that yes, you would like to speak with Julius directly. When you get put on hold, practice your script in which you tell him (or the poor proxy who’s actually taking all these calls) that you do not want the FCC to cut a backroom deal with corporations that could kill the open Internet.

And while you are at it, drop the FCC a letter letting them know they need to man up, grow a sack, and start working for the people that use the web, not kow-tow to the service providers that want to pocket as much money as they can from the people.