It has recently been revealed in court documents that Google paid Apple a staggering $20 billion in 2022 to keep Google Search as the default option on Apple’s Safari web browser. This agreement has been in place since 2002, but the financial details were kept confidential until now.
The disclosure was made during an ongoing lawsuit between the US Department of Justice (DOJ) and Google. The DOJ has accused Google of using its vast resources to stifle competition in the search market, and this multi-billion dollar deal with Apple is a key piece of evidence.
Critics argue that this agreement gives Google an unfair advantage by being the default search engine on iPhones, iPads, and Macs, resulting in a significant boost in user traffic and advertising revenue. This makes it harder for competing search engines like Bing or DuckDuckGo to gain a foothold.
The lawsuit documents also revealed that Microsoft’s CEO, Satya Nadella, testified that the Google-Apple deal makes it nearly impossible for Bing to compete. Microsoft even attempted to convince Apple to switch to Bing, but without success.
Furthermore, Microsoft’s 2018 attempt, gave Apple the option to buy Bing or establish a joint venture. However, Apple was not impressed, as stated by Eddy Cue, Apple’s senior vice president of services,
Microsoft search quality, their investment in search, everything was not significant at all. And so everything was lower. So the search quality itself wasn’t as good. They weren’t investing at any level comparable to Google or to what Microsoft could invest in. And their advertising organization and how they monetize was not very good either.
The outcome of the DOJ lawsuit against Google is still uncertain, but the revelation of this massive payment to Apple has added fuel to the fire. Regulators worldwide are scrutinizing Big Tech companies for anti-competitive practices, and this case is sure to be closely watched.
The $20 billion agreement between Google and Apple highlights the immense value placed on partnerships and alliances in the tech industry. While critics raise concerns about competition and innovation, the partnership remains a cornerstone of both companies’ strategies.
(Via Bloomberg)
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