A threatened boycott against Verizon Wireless has been canceled, after the wireless provider suspended a distribution deal with 1938 Media after complaints about an allegedly racially insensitive video.

Under the now defunct agreement, suspended last week, Verizon Wireless planned to distribute 1938's comedy skits about the technology industry over V CAST, its 3G EV-DO network for delivering audio, video, and games to cell phones.

Loren Feldman, 1938's founder, unveiled the deal on his Web site on June 30. "We are pleased to announce that we will be on the phone with Verizon Wireless V CAST," he wrote in a blog entry.

"I'm bullish on wireless," Feldman said in an accompanying video, adding that some content distributed under the contract would be exclusive to Verizon Wireless.

Then, though, community activists complained that one of 1938's earlier videos -- "Where Are the Black Tech Bloggers?" -- was racist, and that Feldman had a "history" of using negative racial stereotypes on his site.

Najee Ali of Project Islamic Hope, the National Action Network, the L.A. Humanity Foundation, and other activists canceled plans for a national day of protest, along with a Verizon boycott, when Verizon Wireless took down all of 361's videos from V Cast and ended the contract on Monday.

"The Verizon distribution deal with Feldman sends a horrible message that Verizon seeks to partner with racists like Feldman," Ali said in a statement.

Reportedly, "Where Are the Black Tech Bloggers?" was never shown on V CAST, and the wireless provider never had any plans to air it.

In the video, which Feldman claims is satirical in intent, Feldman poses as a black blogger for a fictional Web site dubbed "TechNigga.com," who is promoting a site known as "Ho-trackr.com."

Feldman appears to be resigned to VZW's decision. "Verizon Wireless has chosen to opt out of the distribution agreement with 1938 Media that was announced last week. They were wonderful to work with, and we respect their decision," he wrote, in a blog post this morning.

It's surprising, though, that Verizon Wireless seemingly either wasn't aware of, or didn't consider the impact of, the offending video. Reportedly, Feldman had previously lost distribution deals with both the Huffington Post and PodTech Network over the video.

For its part, V CAST is one of the few mobile phone-based systems that offers 3-D graphics capable of supporting advanced games.

But V CAST only works on "V CAST-enabled" phones from VZW. Further, although V Cast content can be saved to the phone or a removable memory card, it cannot be played back on either PCs or other phones, since it is protected by digital rights management software from PacketVideo.