It was long overdue: Eric Schmidt (Google’s CEO) finally resigned from Apple’s Board of Directors. Usually, these resignations are handled in the smoothest of ways: Thanks for the distinguished service and the like. This time, Steve Jobs issued a pointed 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.” Full officialese here.
This is the Valley and its cozy relationships. By which I mean executives and directors sitting on one another’s board, competitors enjoying the same directors, venture firms “sharing” their partners around portfolio companies. For example, besides Eric Schmidt sitting on both Apple’s and Google’s boards, we have Arthur Levinson, head of Genentech, a director of both companies. Or partners at Sequoia (a very successful venture capital firm)
sitting on boards at YouTube and Google, which might have help a successful “exit”, that is the sale of YouTube to Google.
Back to Apple, there are also lingering allegations of a no-poach agreement, one by which the companies agreed no to hire each other’s workers.
Closer to home: Be, Inc., the operating system company I founded with a few friends from Apple and elsewhere. For a while, one of our investors (and director) also sat on Microsoft’s board. Microsoft executives were investors in his firm and we ended up with Bill Gates (indirectly) owning a piece of Be. Ah well… That was a decade ago, the statute of limitations ran out.
The SEC (Securities and Exchange Commission), the stock market regulator, has become more aggressive in watching out for companies engaging in collusive behavior through cross-directorships. See here .
Back to Dear Leader’s words: Google enters more of Apple’s core business. More