Okay I think I have it here.
When in Eclipse do the following
- Expand your project name in the left pane under Package Explorer
- Find the "AndroidManifest.xml" and select / double click on it.
- On the right click the contents will load; for whatever reason for me by default the window was sized very small and I had to drag the border downwards to see what was inside this.
- Notice there are tabs on the bottom edge of the window..
- Click on the "Permissions"
- Find the line for Network permissions - click on it to highlight it and click the "remove" button.
- Now upon recompile your project will no longer ask for the customer to give network access on insatllation.
For whatever reason hand editing the androidmanifest.xml left a remainder that was not effective; but doing it in Eclipse worked fine.