Monday, May 4, 2009

Memo to Eric Schmidt: Duh.

To quote an article from AppleInsider:

A report by the New York Times explained that the investigation centers on the Section 8 provision of The Clayton Antitrust Act of 1914, which forbids "interlocking directorates," a situation where directors serve on the boards of two competing companies.

Eric Schmidt, the chief executive of Google, and Arthur Levinson, the former chief executive of Genentech, serve on the boards of both Apple and Google. If the FTC were to take action in the matter, the largest consequence would call for the two members to resign from their duties as directors for one of the two companies. Antitrust experts cited by Times stated that "investigations of interlocking directorates rarely lead to major confrontations between companies and the government."
Ten years ago, everyone flocked to Yahoo! for much of their search engine and free Web-based email needs. Ten years ago, Microsoft was in legal trouble for their monopolistic practices, and that Evil Empire reputation remains to this day.

Today, the vast majority of Net surfers go to Google for search results and Google's Gmail for Webmail, among several of Google's other services - YouTube and Blogger, which hosts this blog, et al. Today, while Apple's computer division still retains about 10% of all PC users (despite the consumer dichotomy, less-than-server-class computers are personal ones), Apple's iTunes/iPod/iPhone/small gizmo division is pretty dominant - or at least strongly competing - in its various covered fields: iTunes vs. AmazonMP3 vs. Wal-Mart's MP3 Service (?); iPod vs. other mp3 players; iPhone vs. Blackberry vs. other smartphones; etc.

With Google's G1 also growing in the smartphone realm, as well as talk of Google's Android OS evolving for (at least) netbook PC use, it's no wonder that antitrust red flags wave strongly in this game of corporate intrigue. The Federal government is supposed to try to prevent the inevitable formation of Goopple (RE: a previous facetious rant) and products like the gPod and iGoogle. Scratch the last one. Google Pro, perhaps?

In any case, I anticipate that Eric Schmidt will (be forced to) step down from the Apple board, since he is the CEO of Google. I don't know which side Arthur Levinson will pick. Let's guess that he'll pick Apple...who knows? As for me, I will continue to own my small pieces of Google and Apple, until which time the respective share prices give me a good profit. Then I will eventually sell my small claim to both companies, at a capital gain, and I will have to report that on the year's tax return.

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