Robert Triggs / Android Authority
TL;DR
- In response to a brand new report, Google may very well be paying Apple anyplace between $18 billion to $20 billion a yr to stay the “dominant search engine within the iPhone.”
- Apple fully controls the iPhone, which estimatedly generates over $60 billion in promoting revenues.
- If regulators take a tough stance, this settlement between Google and Apple is probably not sticking round for too lengthy.
Google and Apple are rivals in lots of areas, primarily dealing with one another within the iOS vs Android debate. However the firms additionally contribute to one another’s stability sheets extra straight. We already know that Google pays Apple to be the default search engine on iPhones. However because it seems, it pays a lot of cash for this.
In response to The Register, citing a report from analyst agency Bernstein, Google pays Apple anyplace between $18 billion to $20 billion a yr to stay the “dominant search engine within the iPhone.” This remark was made within the context of an Info Companies Settlement (ISA) between Apple and Google that the US Division of Justice is investigating in an antitrust go well with towards Google.
The report mentions that there’s a chance that the federal courtroom will rule towards Google and drive it to terminate its search cope with Apple. This deal is alleged to account for 14-16% of Apple’s annual working earnings. Google’s monetary reviews point out that it pays out 22% of its whole advert income on visitors acquisition prices. Of this 22%, Apple is alleged to possible obtain 40% (which calculates to be 8.8% of Google’s whole advert income) by Bernstein. Google generated $222.47 billion in income from promoting in 2022, which places Apple’s incoming receipts at about $19.5 billion in 2022.
The numerical determine for the ISA varies relying on who you ask. The Division of Justice believes Apple will get about $10 billion from the ISA with Google, however the report notes that this quantity comes from exterior sources.
Apple controls the iPhone, and the report additional notes that it generates over $60 billion in promoting revenues. So each firms might nonetheless be getting a candy deal out of it regardless of the astronomical fee. If the federal courtroom guidelines towards Google and forces the ISA to be terminated, Apple might get the chance to onboard different search engines like google and yahoo like Microsoft’s Bing and even launch its personal. Nevertheless, there’s nonetheless a protracted approach to go for the courtroom’s determination.