Google chief executive Eric Schmidt today resigned from Apple's board of directors, admitting that increasing competition between the two technology giants made his position impossible.

Steve Jobs, chief executive of Apple, said: “Unfortunately, as Google enters more of Apple's core businesses, 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.”

In May the US government said it was opening an investigation into the interlocking directorships between the two companies, fearing that they could interfere with competition.

Arthur Levinson was at the time also on the board of both companies. He remains a Google director.

Google dominates the search and search advertising markets around the world, while Apple is one of the most profitable companies in the computer and mobile phone field.

Suspicions of favouritism were raised because every default Google search made through Apple's Safari web browser brings in a small payment to Apple from Google.

Schmidt had been on Apple's board since August 2006. He was recruited to Google in 2001 by its founders, Larry Page and Sergey Brin.

When he joined Apple's board in 2006, Jobs said: “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.”