Apple And Google Collide - InformationWeek

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8/3/2009
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Apple And Google Collide

Developer disaffection with Apple appears to be growing, spurred by the company's rejection of Google Voice and other apps.

In a sign of the growing competitive tensions between Apple and Google, Google CEO Eric Schmidt resigned on Monday from Apple's Board of Directors, where he has served for three years.

"I have very much enjoyed my time on the Apple Board," said Schmidt in an e-mailed statement. "It's a fantastic company. But as Apple explained today we've agreed it makes sense for me to step down now."

Apple made the announcement on Monday morning following reports on Friday that the Federal Communications Commission had begin an inquiry into Apple's rejection of the Google Voice app from its iPhone App Store, along with other voice-enabled apps. The Federal Trade Commission continues to look into whether Schmidt's presence on Apple's board violated competition rules.

"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, in a statement. "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."

Jobs' suggestion that Chrome OS represents a competitive threat to Apple's interests lends credence to rumors that Apple plans to release a flat-panel tablet computer. Google has positioned Chrome OS as an operating system primarily for netbooks, or sub-notebook computers. Moreover, Google's plan to begin selling digital books later this year means that Apple will have to face competition from both Google and Amazon if it ever plans to sell digital books through iTunes.

Jobs' statement also underscores a fundamental philosophical incompatibility between Apple and Google, a rift so vast that only mutual suspicion of Microsoft could have gotten the two companies into bed together.

Apple's interest in recent years has been maintaining tight control over its various platforms: Mac OS, the iPhone, and iTunes. It has manifested this interest by suing bloggers who publish alleged secrets, by altering its software to limit the ability of third-party applications to interoperate with its iTunes software, by arguing against a copyright infringement exemption for those want to use the iPhone without Apple's oversight, and by refusing to allow third-party applications like the Google Voice app that could threaten the company's revenues.

Google, hardly an angel itself when it comes to defending its interests, is more concerned with growing the amount of information online than with making sure that information flows through a specific gateway. In part that's a function of Google's online dominance: Just as Rome's dominance two thousand years ago gave rise to the saying, "All roads lead to Rome," nearly all online ads lead to Google, or at least they did before Microsoft and Yahoo joined forces. For Google, it's all about the open Web, where Google is always the low-price leader, thanks to the subsidy of its ad empire.

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