Google pays $3 billion to Apple per year to remain as default search engine on iOS
California/ USA, August 21: Apple and Google, when coming to tech, can be both best friends as well as enemies. On one side, they are good partners at specific deals and at the other hand, biggest competitors. As per media reports, Google pay as much as $3 billion per year to Apple just to remain the default search engine on iOS.
Previous court document signify that Google had been paying $1 billion from 2014 to remain the default search engine on iOS, says media reports. Since then mobile traffic and iPhone sales have been steadily increasing. Right now the number has turned to be around $3 billion when considering Apple’s services revenue (licensing revenue in particular) and Google’s traffic acquisition costs. It indicates that, still, Google is highly dependent on Apple.
Google receives majority of its revenue from the advertisements that appear on the search result pages. Around eighteen percent of the smartphone market is controlled by Apple.
When people update their devices to latest version of iOS within no time, it hardly takes long to change the default setting on these millions of advanced smartphones. To obtain the heavy traffic, Google has no other choice but to spend tons of money.
Earlier, iPhones were shipped with built-in YouTube app and Google Maps. Later, Apple realised that Google is on its way to be a tough competitor with Android. Soon YouTube app was removed by the company and it worked on Apple Maps. Thus moving, Apple couldn’t get much revenue from Microsoft Bing, Yahoo Search or DuckDuckGo. But that was not at all a serious issue as Apple currently receives more than $45 billion as revenue.
On the smartphone front, Apple and Google keep themselves innovative and competitive. They are good partners on other aspects and even pay each other, says media reports.