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Apple, Google Fail to Escape Regulatory Scrutiny

I have a feeling that somewhere in Calfiornia, both Eric Schmidt and Steve Jobs are wondering where they went wrong. Together and separately to varying degrees, Google and Apple each has been flirting with the edges of business practice and what regulators would stand. Since May, they'd been under the magnifying glass, if not the microscope yet, of the Federal Trade Commission over having shared two board directors, including Google's CEO. And now, no matter what they do, that interest won't stop developing.

Just last week, the FTC decided to look into Apple's refusal to carry Google Voice in the iPhone app store. (And an aside: Am I wrong, or is it begging to be tagged for monopolistic practices when a company insists on being the only outlet for third party software for its own devices and making it impossible for anyone else to do business with those consumers in an unencumbered way? Just wondering.)

I thought that the incident, combined with Schmidt's resignation from the Apple board, was a way to signal to regulators that they didn't have to keep probing. So much for success there. The FTC has indicated that it will continue its inquiry into the Apple-Google board relationships. According to the Reuters story, even though Schmidt resigned, former Genentech CEO Arthur Levinson is still on the board of the two -- Dare we say it? -- competitors, and that's enough to keep the agency from dropping the investigation.

It's going to take a complete break in the chain between the two for the FTC to back off -- at least on this issue. But there have been so many other potential areas for inquiry, whether exploding iPods, or concerns over online privacy, that even getting one particular monkey off the corporate back is going to be far from solving an ongoing problem with authority.

Photo courtesy of Kimberlee Kessler Design via stock.xchng, site standard license.

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