Policy Fugue by Kenneth Corbin (bio )

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Schmidt rethinking role on Apple's board

By Kenneth Corbin on July 10, 2009 10:35 AM

Google CEO Eric Schmidt may be moving toward stepping down from his role as a member of Apple's board of directors, a relationship that has come under federal scrutiny for conflicts of interest stemming from the areas in which the two companies compete.

Speaking at a press briefing at Allen & Co.'s annual conference for media and technology moguls in Sun Valley, Idaho, Schmidt said he would talk to Apple about his board seat following the unveiling of Google's plans to launch an operating system, according to a Reuters report.

Prior to the OS announcement, the Federal Trade Commission had opened an inquiry into Schmidt's role on the board of a company that already competed with Google (NASDAQ: GOOG) in mobile (iPhone v. Android OS) and Web browsers (Safari v. Chrome).

Now that Google is developing an operating system geared for netbook computers, the two companies seem headed for competition in a more fundamental level.

Schmidt has said he sits out of any board meetings where Apple's (NASDAQ: APPL) iPhone is being discussed, as well as some that concern hiring and other areas where the conflicts might arise.

Schmidt said he expects the first devices powered by Google's forthcoming OS to the market in the second half of 2010. For the moment Google is framing its plans around netbooks, the smaller, lightweight notebooks that are arguably a different class of device than the traditional laptop computer.

But the lines are blurring. Small devices are getting bigger, and big one are getting smaller, and many look ahead to the distinction between a netbook and a notebook going by the wayside as all portable devices become points on a common spectrum. That would cast Apple and Google as direct competitors, once again, and raise more questions among Washington regulators who Google has little interest in provoking these days.

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