Google CEO Eric Schmidt resigns from position as Apple board member

Early last May, the FTC began investigating whether or not the close ties shared between Google and Apple were in violation of the "interlocking directorates" portion of the Clayton Antitrust Act of 1914. But before it could make any determination, Apple announced yesterday that Google CEO would resign from his position as an Apple board member due to a conflict of interest.

Early last May, the FTC began investigating whether or not the close ties shared between Google and Apple were in violation of the "interlocking directorates" portion of the Clayton Antitrust Act of 1914. 

The "interlocking directorates" portion of the act prohibits an individual from occupying board seats on 2 separate companies if those companies are in competition with each other, with the underlying goal to prevent collusion and and monopolistic behavior.

The catalyst for the investigation centered on Google CEO Eric Schmidt's dual role as a board member on both Google and Apple's board of directors.  While Google and Apple aren't ordinarily thought of as competitors, that reality has begun to shift as Google has started branching out into areas already serviced by Apple.  For example, there is the Google Chrome web browser, the Android OS for mobile phones, and most recently, Google announced plans to deliver a Google Chrome operating system.  Apple of course has its Safari web browser, the iPhone, and of course, its OS X operating system.

When news of the FTC investigation first came to light, Schmidt was unfazed about his dual role as a board member at 2 separate companies.  "I'll talk to the Apple people", Schmidt remarked, "at the moment, there's no change."

Well it turns out that after talking to the "Apple people" that there is, in fact, a change.

Apple issued a press release yesterday morning announcing the resignation of Eric Schmidt from Apple's board of directors due to a potential conflict of interest.  The press release reads, in part:

“Eric has been an excellent Board member for Apple, investing his valuable time, talent, passion and wisdom to help make Apple successful,” said Steve Jobs, Apple’s CEO. “Unfortunately, as Google enters more of Apple’s core businesses, with Android and now Chrome OS, Eric’s effectiveness as an Apple Board member will be significantly diminished, since he will have to recuse himself from even larger portions of our meetings due to potential conflicts of interest. Therefore, we have mutually decided that now is the right time for Eric to resign his position on Apple’s Board.”

Interestingly, though, the FTC still plans to proceed with its investigation because Apple and Google happen to share another board member - Genentech CEO Arthur Levinson.  Also of note is that Apple board member Al Gore also happens to be a special advisor to Google, though it's unclear what exactly that "special advisor" role entails.

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