A lawyer representing Apple has objected to claims made in court about how much Google pays the Cupertino company to be the default search engine on iPhones and other devices.
The objection was made in a major antitrust case against the search giant, which could see the Department of Justice force the breakup of the company into separate businesses …
Google pays Apple to be default search engine
Google has for many years paid Apple increasingly large sums of money to be the default search engine on iPhones and other Apple devices.
In other words, if you enter search terms in the combined address and search bar, that search will be carried out on Google, rather than a competing search engine like Bing or Duck Go Go.
That brings Google a huge amount of traffic, enabling it to profit from the ads and sponsored results appearing alongside search results. Not only that, but because Apple customers tend to have more disposable income than Android users, it’s especially valuable traffic to advertisers.
The amount has always been a secret
The sum has always been kept a closely guarded secret by both companies, but we got a glimpse into this arrangement way back in 2014, when a court case revealed the sum to be $1B, which at the time comprised a percentage of the revenue generated – apparently 34%.
Since then, the sum is believed to have steadily increased. In 2017, it was estimated at $3B; in 2018, $9B; in 2020, $10B; and it was estimated to be worth $18-$20B last year.
Apple includes the sum within its Services category, so that it is not identifiable as a specific revenue source.
It’s now part of an antitrust case against Google
The Department of Justice has mounted a massive antitrust case against Google, which may ultimately force the company to be broken up into smaller businesses. This threat is so great that the company even last year voluntarily offered to do this – an offer which the DoJ rejected as not going far enough.
One element of the anticompetitive behavior charges against Google is that it pays Apple not to compete with it in search.
Apple lawyer objected to two numbers being given
As part of its submission, the Justice Department mentioned two specific numbers for the amounts Google was said to have paid Apple for two of the years in question: $5B and $7B.
The Washington Post reports that a lawyer representing Apple objected to the inclusion of these numbers.
The second day of a landmark anti-monopoly trial against Google began on Wednesday with a protest from Apple against two numbers that the Justice Department mentioned in its opening statement the day before […]
On Wednesday morning, Ryan Travers, an attorney representing Apple, which is not a party to the antitrust case, complained that government attorneys may have violated [business confidentiality] rules in regard to Apple. Travers said that two numbers mentioned in passing in the Justice Department’s opening statement might create a “misperception” that they came from Apple’s confidential information. “That would be a violation of the rules of engagement here,” he said.
To be clear, Apple is not commenting on whether or not the numbers are accurate: It is only objecting to the fact that people might think they came from Apple.
The DoJ clarified that the numbers came from external sources, not from either Apple or Google. The judge said that he was satisfied with this.
Photo: Mufid Majnun/Unsplash
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