The longstanding mystery of just how much Google pays Apple to be the default search engine on Apple devices, including Macs, iPads, and iPhones, has come closer to being resolved.
A New York Times report states that Google paid Apple approximately $18 billion in 2021 for this privilege, shedding light on the extensive financial relationship between the two tech giants.
While many estimates and rumors regarding the payment amount were circulating during the US v. Google trial, this figure leans toward the higher end of expectations, with previous guesses ranging from $10 billion to $20 billion.
The financial arrangement not only secures Google’s prominent position on Apple devices but has also historically discouraged Apple from developing its own search engine.
Testimonies during the trial highlighted that Apple had considered various alternatives, including building its own search engine or purchasing Bing.
However, Apple feared competing with Google and potentially jeopardizing the lucrative deal.
Microsoft CEO Satya Nadella suggested another reason for Apple’s commitment to the Google deal: Google could pose a significant challenge if it were to be replaced. By leveraging its popular apps such as Gmail, Maps, and YouTube, Google could redirect users to Chrome and the Google app, potentially undermining the value of Apple’s arrangement with another search engine.
The partnership between Google and Apple, in this sense, resembled a peace treaty, mutually beneficial and deterring potential conflicts.
The terms and consequences of the Google-Apple agreement have taken center stage in the US v. Google trial, with the Justice Department arguing that it creates an anticompetitive monopoly. Testimonies suggest that any search engine securing access to Apple’s vast user base would become a significant player.
As Google begins its part in the ongoing trial, the company asserts that its success results from providing the best search engine, emphasizing that users can easily switch.
However, the $18 billion annual payment from Google to Apple indicates the value both companies see in this collaboration. The trial will continue to explore the intricacies of their financial relationship and its potential impact on competition.
