Google Inc Chief Executive Eric Schmidt said former Genentech CEO Arthur Levinson should stay on the boards of both Google and Apple Inc, despite regulatory scrutiny.

Schmidt said on Friday that Google and Apple easily passed an antitrust test for overlapping board members relating to revenue overlap.

Google and Apple are well below that percentage, Schmidt told a conference hosted by the Atlantic and the Aspen Institute.

Google, the No. 1 Internet search company in the United States and Apple, the maker of the iPhone and Mac computers, find themselves competing on a number of fronts, including operating systems and the fast-growing smartphone market.

The two had long been seen as allies against Microsoft Corp's tech dominance.

In August Schmidt quit Apple's board of directors, a move that was seen as helping defuse some scrutiny of their relationship as they compete in some markets.

But the U.S. Federal Trade Commission said in August it would continue to investigate the relationship between the two boards.

Asked on Friday if Levinson would step down, Schmidt said: I would hope not... because I don't think it's necessary. Schmidt said he did not step down under any pressure.

Google and Apple have bickered in recent statements to the Federal Communications Commission about why Google's Voice application is not available on Apple's iPhone.

Google said Apple rejected it. But Apple said it is still studying it because the application alters the iPhone's telephone functionality and user interface.

At Friday's conference, Schmidt emphasized the benefits to Google from the iPhone.

The iPhone is our largest source of mobile search queries. The iPhone itself is responsible for 30 or 40 times more of our search queries than anything else, Schmidt said. So we love the iPhone and we love the apps that drive it.

(Reporting by John Poirier; Editing by Tim Dobbyn)

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