Time to Give Up That Apple Board Seat, Eric
“Eric is obviously doing a terrific job as CEO of Google, and we look forward to his contributions as a member of Apple’s board of directors. Like Apple, Google is very focused on innovation and we think Eric’s insights and experience will be very valuable in helping to guide Apple in the years ahead.”
–Apple CEO Steve Jobs, Aug. 2006
“Apple is one of the companies in the world that I most admire. I’m really looking forward to working with Steve and Apple’s board to help with all of the amazing things Apple is doing.”
–Google CEO Eric Schmidt, Aug. 2006
He had a good run of it, but Google CEO Eric Schmidt’s stint as an Apple director may be coming to an end.
Now that the Federal Trade Commission is investigating whether the close ties between Apple’s and Google’s boards of directors violate antitrust laws, Schmidt’s seat on the former’s board, which he has held since August 2006, seems more trouble than its worth.
People briefed on the matter tell the New York Times that the FTC is concerned that Schmidt’s presence on Apple’s board–as well as that of Google director Arthur Levinson and Google advisers Bill Campbell and Al Gore–might lead to the conflicts of interest or unfair business practices. And that seems a reasonable concern; certainly those sorts of things sometimes occur when a coterie of people hold influence over several major firms simultaneously.
While Google (GOOG) and Apple (AAPL) compete in a number of areas–browsers and mobile operating systems–the two have also worked together closely to bring a number of Google services to the iPhone. They also share a common enemy in Microsoft (MSFT).
So it’s not surprising to hear that the FTC is raising an eyebrow over the cozy relationship between the companies–especially, given its previous interest in Google and the opinions of U.S. antitrust chief Christine Varney, who recently described the company as a monopolist.
Nor will it be surprising when Schmidt resigns from Apple’s board, if this inquiry goes further. That’s typically what happens in these situations when things start heading toward a longer investigation.
So, given the amount of antitrust scrutiny currently leveled at Google, it’s almost certainly what will happen here.