Google will pay Apple $ 15 billion for being the leading search engine on the iPhone

Google will pay Apple $ 15 billion for being the leading search engine on the iPhone

“We have noted in prior research that Google is likely paying to ensure Microsoft doesn’t outbid it.” — Analyst Toni Sacconaghi According to Bernstein analyst Toni Sacconaghi, Google is pouring billions of dollars into Apple in order to ensure Microsoft won’t outbid it. If so, this could make the iPhone’s native search engine Microsoft Bing. Google Search could become the default search engine of only one mobile operating system – Google to pay Apple $15 billion so it remains the iPhone’s default search engine. Google Search could become the default search engine of only one mobile operating system

The fact that Google pays Apple to be the default search engine on the iPhone, iPad, and Mac has long been known, and the tech behemoth pays handsomely for this “courtesy.” According to a new Bernstein analysis, the charge will rise by $5 billion this year. It is predicted that Google paid Apple $10 billion in 2020 to maintain its search engine as the default one, and that the price tag would rise to $15 billion in 2021. Ped30 discovered this information in an investor letter. According to the paper, the high price tag would rise even more in 2022, hitting $18 to $20 billion. This data is derived from

Highlights

  • Apple is striving to increase its revenue from Services, which also accounts Google’s fee. According to 9to5Mac, the Cupertino company wanted to proof its investors that it can be profitable not only by selling hardware. Sacconaghi says that there are two potential risks to the increase in price. The first one is a regulatory risk, which means that Google might lose its license to operate. Even so, he states that this is probably years away. The second and more probable risk is Google choosing not to pay the high amount anymore. This could mean Google renegotiating the price with Apple in order to pay less, or refuse to pay altogether. If so, Apple will have a tough choice to make. Does it go with Microsoft at the risk of potentially losing market share, as plenty of people won’t like this decision, or does it offer a lower rate to Google, so it keeps its services revenue high? This is a choice that the company might soon have to make.