[Sohcahtoa82]

> wouldn't your network service provider also be able to filter based on SNI?

Two things:

1. Only if they knew that the hostname in question is indeed being used for telnet tunneling. You can set that host name to whatever you want.

2. Encrypted SNI is a thing.

> You would need to agree on a protocol and you would gain all the advantages but also the disadvantages of the tunneling protocol.

Yeah, admittedly the entire thing is a bit contrived. If your client is capable of speaking the tunneling protocol, then likely you'd just use the tunneling protocol itself, rather than using it to tunnel telnet.