Apple is charging billions Google for making it default search option on all Apple devices.
Tech giants always keep in a fight to outrun each other in order to increase their market value and provide better services to the users. iPhone maker and the top search engine also have the same relationship, whether it's about the smartphone competition or tech innovation. But, both the companies know each other’s impact and value among the users and never misses the opportunity to leverage that. Recent research from the Bernstein, an American firm management or research service company reveals that Google may pay $3bn to Apple to make its default search engine in the devices.
The latest study, which is based on the third party research information and the Apple’s license revenues shows that Google pays the Apple to get default searches. The research, including all the data and information, concludes that the Google investment may get up to $3bn for this fiscal year.
“Google's willingness to pay Apple for default search access is a testament to iOS's strength in the tech world,” Daniel Chen and Toni Sacconaghi mentioned in their report for Bernstein.
In 2016, a lawyer for Oracle while accusing Google for the copyright contravention also stated that the company paid Apple $1bn in 2014 to make the Google default browser in Safari on iPhones.
The research also stated the reason behind this step by the tech giant as Google’s mobile revenue has tripled from $16bn in 2014 to $50bn in 2017. These figures are the reason behind Google making a deal with the Apple. Bernstein also revealed that Apple’s services revenue raised year-on- year by $ 2.4bn along with the possible licensing revenue of $500m. The increased growth in the revenue predicts the $1bn-per-year increase for this year.
However, both the companies did not reply to the reports and there is no statement made by the either of them yet. The payment for the default browser could be both harmful and profitable for Apple. As Apple is getting more users it will also get, the more payment for the deal. But after a certain period of time when Google feels like it has acquired strong number of the search users it may not feel to continue the deal with Apple.
The report also mentioned this warning by saying,”Google could ultimately decide that its search position is sufficiently strong that it no longer needs to pay to be the default browser.”
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