It’s no secret that Google and Apple are fierce competitors in the tech industry, but there is one area where the two have a cozy relationship and that is search engines.
Google owns Android, which happens to be the most dominants mobile operating system in the entire world. Services like Google Search, Google Maps, Gmail and YouTube all lie at the heart of modern life.
But in order to remain competitive, especially in markets such as the US, Google has to pay a hefty price to Apple.
In this article, we’ll have a look at why this is the case.
So Why Does Google Pay Apple?
What is the first thing that comes to your mind when you want to search for anything on the internet? A quick Google search, right?
According to StatCounter Google has more than 90% (93.37% to be more specific) share in the global search engine market share. And this is mostly because almost no one changes their default search engine to say, Bing, whenever they get a new device.
Regardless of whichever phone brand you go for, be it an iPhone or a Samsung phone, Google Search is the default search engine.
And this is why Google pays Apple billions every year.
Turns out, Google pays Apple billions of dollars every year to remain the default search engine on all Apple devices.
The exact amount that Google pays Apple is not publicly disclosed but in 2020, this figure was estimated to be between $8–$12 billion, as reported by The Wall Street Journal.
According to a Forbes report, this figure neared $15 billion in 2021 and was projected to reach $18–$20 billion in 2022.
These payments represents as much as a fifth of Apple’s annual profits and this would certainly explain why Apple has never explicitly attempted to out-Google Google, despite having a captive audience of well over a billion users.
Another interesting revelation is that Google allegedly made an agreement with Apple that prevents it from developing or promoting a competing search engine.
This alleged agreement led to a lawsuit being filed by several US states against the Alphabet owned company last year.
Thoughts On This Agreement
This arrangement benefits both companies financially, but it also raises some concerns about market dominance and consumer choice.
I argue that Google’s payments to Apple stifles competition and innovation in the search industry and give users less control over their privacy settings.
Also, things don’t look too good for Google with the sudden explosive popularity of Microsoft’s new Bing search engine thanks to it’s integration with ChatGPT.
If more people adopt Bing as their default search engine, Apple can decide to take advantage of this and force Google to pay more. And if Google was to refuse, Microsoft would happily outbid Google, making Bing the default search engine on all Apple products.
What do you think about this deal between Google and Apple? Do you use Google as your default search engine on your Apple device? Let us know in the comments section below or carry the discussion over to our Twitter, Facebook and Telegram
