While the FCC’s investigation of Apple’s rejection of the Google Voice iPhone App has been making big headlines the last few days, another government investigation into the two companies seems to be slowing down (but not stopping): The Federal Trade Commission’s (FTC) interlocking directorates probe.
For the last few months, the FTC has been investigating whether Apple and Google have been participating in anti-competitive practices by having Google’s CEO on Apple’s board of directors. Considering Google has several competing products (Android, Google Chrome, Chrome OS), it made some sense.
Now that Google’s CEO has resigned from Apple’s board, you’d think the investigation would be over. Not so, according to the FTC. They put out a statement earlier today giving a thumbs-up to Schmidt’s resignation but clearly stating the investigation will continue:
On August 3, 2009, Apple announced that Eric E. Schmidt, Chief Executive Officer of Google, was stepping down from its board. “We have been investigating the Google/Apple interlocking directorates issue for some time and commend them for recognizing that sharing directors raises competitive issues, as Google and Apple increasingly compete with each other,” said Bureau of Competition Director Richard Feinstein. “We will continue to investigate remaining interlocking directorates between the companies.”
So why isn’t this case going away? The answer’s simpler than you might think: Google and Apple still share a director: Arthur Levinson, the former CEO of biotech giant Genentech. Until he resigns from one of the two boards, the investigation will continue. Once he leaves though, it would be difficult to justify charging either company with any wrongdoing retroactively. Expect Levinson to leave one of the two boards in the near future.
Besides, neither company was really focusing on the FTC probe anyway. Now it’s about the FCC Google Voice investigation, where they’re on opposite sides. The events of the last few days are probably the beginning of a new era of standing on opposite ends for the two storied giants.
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Tags: apple, FTC, Google