Google’s Schmidt may give up Apple board seat
There has been some response from the primary players in the ongoing saga of shared members on the Apple and Google boards, with Eric Schmidt saying he may give up his seat on the Apple board.
The Federal Trade Commission has been looking into a number of practices by Apple and Google, including shared board memberships and collusion on critical employee hiring. At least one of those controversies may be coming to a head with the expected introduction of the Google Chrome operating system for netbook computers.
The FTC and many experts in the field of corporate governance and ethics agree that a situation like the one Apple and Google are in is tenuous at best. The two companies compete in too many areas to make shared board membership a good idea. Schmidt says that he recuses himself from discussions in competitive areas, but with cell phone operating systems, and now netbook operating systems at issue, this is one balancing act that may be difficult to maintain.
Steve Jobs and Eric Schmidt have had an excellent relationship through the years since Google’s initial ramp up to search engine prominence, according to a DailyTech article. They each have important CEO positions at premier Silicon Valley companies. They move in the same circles and reportedly see each other socially as well as in numerous business situations during the year.
However, there are rules against what the two companies are doing in terms of shared board seats, and the FTC has been looking into the problem for a couple of months. Schmidt recently said during a newspaper interview, “I’ll talk to the Apple people. At the moment, there’s no issue.”
Schmidt is one of the few people that believes that to be the case and is probably being disingenuous. Most observers feel that it breaks the spirit, and probably the law, regarding membership on the boards of competing companies. Many believe that Schmidt will probably step down from the Apple board when the Chrome netbook operating system is officially released in September. That seems to be the straw that will finally break the back of this particular camel.
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