FTC investigates ties between Apple and Google

The Federal Trade Commission (FTC) is reportedly set to investigate whether or not the fact that Apple and Google share 2 of the same board members violates the “interlocking directorates” portion of the Clayton Antitrust Act of 1914. The two board members at the root of the government inquiry are Google CEO Eric Schmidt and former Genentech CEO Arthur Levinson. Under the pertinent section of the Clayton Antitrust Act, individuals are prohibited from serving as board members for two separate companies if the two companies are in direct competition with each other. The intent of the law, though rarely enforced, is to prevent monopolistic behavior and to encourage real competition within industries. Whether or not Google and Apple are competitors is an interesting question. While Google is largely known for its search services, it recently entered the smartphone market with the release of the Android OS, and it’s also hard at work developing a Mac version of its Chrome web browser. Both of the above products clearly compete directly with similar offerings from Apple (i.e the iPhone and Safari). But despite the fact that Google and Apple produce competing products, the two companies seem to share a close collaborative relationship as well. For example, Apple has been able to leverage its relationship with Google to help bolster iPhone sales. The iPhone, for instance, isn’t flash capable, but Apple was able to get Google to make YouTube videos watchable on the iPhone when it was first released. In addition, the Maps application on the iPhone homescreen is powered by Google Maps. Even more astounding is a report from a few months ago which had Apple asking Google not to implement multi-touch functionality on the first Android phone, even though the OS is more than capable of supporting it. The relationship between Google and Apple is confusing, to be sure. While they certainly compete with each other to an extent, they also are willing to help each other out – though some might argue that Google is doing all the helping. The nature of this somewhat paradoxical relationship is apparently what the FTC is looking to investigate, and it makes sense that they’d be curious. Anytime you have board members who share board seats on two of the most powerful Tech companies in the world, questions and concerns are bound to arise. Whether or not the FTC finds anything objectionable remains to be seen, but even in the event that they cry foul, all that’s needed to remedy potential concerns would be for both board members to resign from just one of their respective positions.