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A Tech-Econ Mashup with a Libertarian Flavor

FTC Investigates Apple and Google Boards for Possible Antitrust Violations

The Federal Trade Commission launched an investigation Monday into the ties between the boards of Google and Apple. Eric Schmidt and Arthur Levinson each sit on the boards for both companies, although according to antitrust law, a person may not sit on the board of two companies if it decreases competition between them.

As if it needs to be said, Apple and Google aren’t really competitors, not in any meaningful sense, anyway. Google is an information services company that specializes in internet search, advertising, information organization, and not being evil. Apple is primarily a hardware company that manufactures PCs (called “Macs,” though technically they’re still personal computers), mp3 players, cell phones, and “edgy” urban hipsters. In effect, Google is the top company for geeks with mathematics PhDs, Apple the haven for geek-wannabes with horn-rimmed glasses.

If the two company’s compete anywhere, it’s in the wireless marketplace, albeit indirectly. Google’s entry into the smart phone market (through its open-source Android operating system) has no doubt spurred this investigation. Android runs on T-mobile “smart” handsets, which compete with the AT&T iPhone (both of which compete with Blackberry, HTC, Palm, etc). Here’s the rub: Apple itself only has about a 1% share of the cell phone market, and about 6% of the smartphone market, while the Android phone is about 4% (smartphones make up about 12% of the entire cell phone market).  Google also has a deal pending with HP that would put the Google OS on a new line of HP netbooks, which would bring Apple and Google closer to being true competitors, but rumors aside, Apple appears to have no intent to enter the netbook market.

While I don’t object to the FTC’s goal to promote a competitive marketplace, this investigation is unecessary. The tech market has historically been the least regulated, most competitive, and fastest advancing sector of the economy, while tech prices have come down year after year after year. Let’s chill out and leave it alone.

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Filed under: Computers and Software, Tech Biz, , , , ,

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Whenever you find that you are on the side of the majority, it's time to pause and reflect.
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