“Eric is obviously doing a terrific job as CEO of Google, and we look forward to his contributions as a member of Apple’s board of directors. Like Apple, Google is very focused on innovation and we think Eric’s insights and experience will be very valuable in helping to guide Apple in the years ahead.”

–Apple CEO Steve Jobs, August 2006

“Apple is one of the companies in the world that I most admire. I’m really looking forward to working with Steve and Apple’s board to help with all of the amazing things Apple is doing.”

–Google CEO Eric Schmidt, August 2006

Asked earlier this year if he would resign from Apple’s board in the face of Federal Trade Commission scrutiny of the close ties between the two companies’ boards of directors, Google CEO Eric Schmidt replied simply, “It hasn’t crossed my mind.”

Well, apparently it has now.

Citing the growing overlap of the two companies’ businesses, Schmidt is giving up his seat on Apple’s board, which he has held since August 2006.

“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. “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.”

“I have very much enjoyed my time on the Apple board,” Schmidt said in a statement of his own. “It’s a fantastic company. But as Apple explained today we’ve agreed it makes sense for me to step down now.”

A wise move. Schmidt’s boardroom role was already reduced because of competitive issues between the iPhone and Android and between Safari and Chrome. Given the obvious competitive issues between the Mac and Google operating systems, it is inevitable that his board involvement would shrink again. Had he retained his seat, Schmidt would have likely spent more time standing outside Apple’s boardroom than in it.

So why bother? Better to step down and avoid the appearance of impropriety, especially when regulators seem to be singling Google (GOOG) out for all manner of scrutiny. Certainly, Apple (AAPL) must be relieved to have the guy with the FTC target on his back out of the boardroom.

And relations between the two companies must have been a bit strained by this Google Voice for iPhone debacle.

Beyond that, there is little else to report. To wit, this first-hand account of the event posted to the Apple Insider forums:

There’s really nothing ‘material’ to report–even the usual gadflies (especially Mr. Ehrlich, the dude who disses Al Gore, the unions, and ‘socialist’ shareholders) trotted out the same old stuff.

The big event seemed to be the motley crew’s rendition of Happy Birthday to the absent CEO S. Jobs. The tenor was slightly different in that non-executive members-of-the-board (Levinson & Campbell) fielded questions at the behest of Tim Cook.

To me, the fact that few, if any, analyst-style financial questions were proffered shows that shareholders have little to wonder about the business of the juggernaut. This year, there was no barrage of product strategy questions by the likes of Prince McLean, which never really get addressed, per regulation FD and Apple policy, except enigmatically by Steve.”

Team,
I am sure all of you saw my letter last week sharing something very personal with the Apple community. Unfortunately, the curiosity over my personal health continues to be a distraction not only for me and my family, but everyone else at Apple as well. In addition, during the past week I have learned that my health-related issues are more complex than I originally thought.

Steve

Coming as it does after Jobs’s disclosure last week that he had a hormone deficiency that had caused him to dramatically lose weight, this is very worrisome news for Apple and its shareholders.

If Microsoft really wants to buy Yahoo, “we again invite them to make a proposal immediately. And if Mr. Icahn has an actual plan for Yahoo beyond hoping that Microsoft might actually consummate a deal which they have repeatedly walked away from, we would be very interested in hearing it,” Yahoo said in a statement. The company noted as well that “as recently as June, Yahoo!’s independent directors and management approached Steve Ballmer about just such a transaction, only to be told that Microsoft was no longer interested even in the price range which they had previously proposed.”

So what now? Who knows. Piper Jaffray (PJC) analyst Gene Munster figures Icahn, who still plans to run a full board slate, has a decent chance of prevailing at Yahoo’s Aug. 1 meeting. “We had previously suggested that Icahn had a 30% likelihood of gaining control of Yahoo!’s board at the annual meeting,” Munster said in a research note. “Now we believe he has a 50% chance of gaining control.”