So How Are Those iPhone Talks Going, Verizon?

Google and Verizon Wireless have evidently gotten over their 700-MHz spectrum auction-inspired differences. This morning, the two companies announced an agreement to deliver mobile applications and devices. Under its terms, the companies will develop several Android-based devices preloaded with apps designed by Google, Verizon and others.

“Integral to this agreement is a commitment by the companies to devote substantial resources to accelerate delivery of leading-edge innovation that will put unique applications in the hands of consumers quickly,” the companies said in a joint release. “The two industry leaders will create, market and distribute products and services, with Verizon Wireless also contributing the breadth of its nationwide distribution channels. Consumers will be able to purchase products resulting from the collaboration in Verizon Wireless retail and online stores.”

The first new phones are expected at market within weeks. Two will be released before the end of the year and they will, according to Verizon Wireless CEO Lowell McAdam, support Google Voice. They’ll also come with Google’s (GOOG) Android Market preinstalled. So Verizon (VZ) is not favoring its own app store here. There will apparently be netbooks as well, though the companies haven’t yet said when.

During a conference call to discuss the announcement, Google CEO Eric Schmidt applauded Verizon’s “openness,” saying it was “frankly, enormously surprising, given the history and the old-line nature of telcos….In Verizon, somehow, the leadership has decided to embrace a very different philosophy, which works very, very well with the Internet.” Schmidt didn’t go into specifics beyond that, but presumably he was referring to Verizon’s willingness to allow Google Voice on its phones–something Apple (AAPL) hasn’t yet done with the iPhone despite continuing controversy.

Asked during the same call if Verizon would allow Google Voice, Verizon Wireless CEO Lowell McAdam said it would. “Either you have an open device or not,” he said. “This will be open.”

The deal is potentially a big one for Google. Verizon serves some 87 million customers. Putting some slick Android phones in front of them could do much to bolster Google’s standing in the wireless market.

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