Death of something predicted in 5..4..3..2..
Mobile companies, both the handset providers and the bandwidth providers, are very sensitive about their property. We buy our handsets from the phone company, subsidised for the life of the account. The retail price of the average smartphone is £3-400, proved by the cost of the Freerunner, and I'm sure that there are very few people reading this who slapped that down for their Crackberry or Pomegranate or whatever shiny toy dragged them into a Vodafone shop last time they passed. In return the providers support these phones, so if yours dies, you can call them and get some assistance in getting it fixed, even if it's just RTB, back up your SIM and get a new one. So the phone companies aren't keen on random software on their machines, and want some kind of control on what data goes in and out of it. Why isn't there a free usable version of MSN Messenger for non-Windows phones? Why is Opera pretty much the only decent alternative (and indeed often main) web browser for smartphones? One is because the phone companies believe IM bites into their call revenue in an unbalanced way, the other is because the web experience is potentially bandwidth-intensive and can't be guaranteed on a handset, despite what Apple thinks.
The G1 business model has been dictated by the success of the iPhone. Remember that Google weren't going to create a phone at first, but have probably been forced to by the reluctance of the phone companies to open their architecture. It came as no surprise to me that it was HTC who have picked it up because they are seemingly trying to find an alternative to Windows Mobile, but they will have required concessions, the FCC will have required concessions, there will have been concessions required for CE certification and no doubt T-Mobile will have had their say too. So a 'killswitch' is the response to a bunch of concessions for every party involved. It could be something as simple as the revocation of the API key, which Google use everywhere, and really, if you downloaded an app that calls Madagascar every 10 minutes, who would you be blaming?