Google CEO Plans on Staying Apple Board Member

| Apple Stock Watch

Google CEO Eric Schmidt told reporters Thursday he intends to remain a member of Apple's board of directors, despite Federal Trade Commission (FTC) investigation into the relationship the two companies have.

"I don't think Apple sees Google as a primary competitor," he said, according to a Wall Street Journal report. Mr. Schmidt made the comments before a Google shareholder meeting. He was backed up by his company's chief legal officer, David Drummond, who said he didn't feel that his boss serving on Apple's board doesn't violate a key test of "overlapping revenue."

At issue is the role of long-time Apple board member Arthur Levinson, who also serves on Google's board of directors, and Mr. Schmidt who is CEO of Google, and sits on both Apple's and Google's boards of directors. The FTC is investigating whether this violates the Clayton Antitrust Act of 1914, which prohibits people from serving on the boards of competing companies.

Apple and Google both make a (free) Web browser, and both companies are in the mobile phone business -- Apple with its iPhone and Google with its Android platform. Mr. Schmidt joined Apple's board in August of 2006, before either Android or iPhone had been announced, and he publicly said in the past that he recuses himself from those portions of board meetings where iPhone issues are concerned.

For now, it would appear as if at least Apple's board of directors is satisfied with their relationship, and that it is within applicable laws -- as there is likely that Mr. Schmidt and his fellow Apple directors discussed the issue before he made his public comments today.

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Comments

vince7

Usually the first reaction is the correct one.  This doesn’t pass the sniff test.  Schmidt should get off of the board just for the sake of appearances.  Iphone and iPod are for now two areas of competition.  I can see the listing growing over time.

It seems that people of means don’t think any law pertains to them.  Rules are meant to be challenged or ignored whenever possible.  We have lost trillions of dollars from our economy and not one banker/crook has been prosecuted.  The law has been harder on welfare moms and hungry kids then these kings/sheiks.

Bring Spitzer back and turn him loose on these bums!

Terrin

I agree that the sniff test is applicable. Accept, I don’t smell any major conflict. Google and Apple aren’t competing in any meaningful way.  Google’s Android isn’t taking sales from Apple or vise versa. Further, Google doesn’t care about selling Android phones as much as it does about protecting it’s search business from Microsoft. That is the same reason it is creating a web browser. It wants to protect it’s search revenue and doesn’t want Microsoft to somehow effect Google by displacing it on Explorer.

Apple isn’t in the search business. In fact, it makes money from Google. Further, Google and Apple have a common enemy: namely Microsoft. That enemy has been found to be an abusive monopoly. It only makes sense that the little guys would team up to protect themselves from the copying bullying Microsoft.

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