Apple announced the appointment of Google CEO Eric Schmidt to its board of directors this week.

The move seems set to reinforce exisiting relationships between the two firms, and Wall Street analysts are beginning to consider what other advantages the strategic move may create.

The appointment of Schmidt reinforces the link between Apple and another high profile Silicon Valley business, Sun. Schmidt is a former executive from Sun, who is widely seen as "still close to" the company.

Sun and Apple merger?

CBS MarketWatch speculates that the move may mean the time is finally right for a merger between Apple and Sun - a merger the two companies have discussed off and on for the last 20 years.

The report goes as far as suggesting that Schmidt, with his experience at innovation-focused Google, may eventually be the man to lead a combination of Apple and Sun.

Sun and Apple's focus on the server market may be the catalyst for such a move. And both companies have former staff from the other company already on their employee roster, meaning connections between the two firms are strong.

Google/Apple alliance?

Business Week meanwhile is mulling over another possible outcome of the new Apple directorial appointment - an alliance between Google and Apple that is designed to take on Microsoft. "The possibilities for cooperation between the two are legion," the report suggests.

The Business Week report looks at the many points in common between the firms. Former US vice president Al Gore sits on Apple's board and is a senior advisor to Google. Intuit chairman Bill Campbell also sits on the Apple board and is a senior Google advisor. Reinforcing the connection is Genentech CEO Arthur Levinson - he sits on the board of both Apple and Google.

Apple's move to Intel processors adds further grist to the mill, as Intel CEO Paul Otellini is a member of the Google board. The report points out many more connections between the firms within leading lights of the venture capital industry.

The report speculates that .Mac members could draw particular benefit from future joint moves by the companies, with Apple perhaps shifting them to Google's online services while working with Google to improve that offering.

The report also speculates that Apple could make certain products, such as Pages or Keynote, integrate with complimentary Google offerings, such as Spreadsheets or Calendar.

Apple will give Google more of the online services world, "including the hosting and creation of blogs, websites, business marketing and sales initiatives around ads/search, and productivity apps," while Google will "cede to Apple the music and video sales, as well as the creation of the ecology of controlled content delivered to the mobile-connected iPod/cell phone," predicts ZDNet's Dana Gardner.

Beyond obvious

Apple also has other connections that may help it and its partners finally dent Microsoft's IT stranglehold. Apple CEO Steve Jobs, for example, is now the largest single shareholder of giant US entertainment firm, Walt Disney.

Returning to Sun, that company's CEO Jonathan Schwartz has quickly driven his firm to become fully open source and focused on providing effective server infrastructure. And Sun and Google reached a partnership deal in October 2005 to help each other with software product marketing.

The timing of the move also suggests that Apple is gathering allies to help it fend off Microsoft's coming attempt to seize the online media market through its Zune player.

The timing also shows Apple to be shoring up its assault on Microsoft's operating system dominance, with Apple touting how advanced its OS is in contrast to Microsoft's yet-to-ship (and OS X-like) Vista operating system.

With Sun, Disney, Google and Apple emerging as an aligned force, some analysts are beginning to predict that the companies together hold the cards to set the future of online content and media delivery - without Microsoft.