Google paid Apple $1 billion in 2014 to be the default search engine of Apple’s iOS.
Apple and Google joined forces to stop the information on their search engine deal from leaking.
Documents during a court session in a lawsuit against Google brought by Oracle have unearthed that Google paid Apple $1 billion dollars in 2014 to be iOS’s default search engine, reports Bloomberg. The sum was discovered in court transcripts of a copyright lawsuit that Oracle brought against Google in which it claims the search mammoth used its Java software, without paying for it, to build Android, the largest platform for mobiles now. Both Google and Apple have both been “beating around the bush” with this issue.
It has been understood that when an iPhone user opens its built-in web browser Safari and searches something on the address bar, it directly connects to Google’s search engine. In newer versions of iOS, it has been implanted that users can manually change the search engine to search through Microsoft’s Bing, Yahoo, or DuckDuckGo instead of the default Google. Interestingly, most users either don’t know they can or don’t care that they can alter the search provider. This action can be seen as highly profitable for Google, considering the huge amount of searches performed each day through the iPhone’s Safari browser, since those search results also show ads. This move by Google is not a surprise, since Safari is the second-most-popular web browser in the world on mobile devices.
It was already rumored for years that Google has been paying Apple a big sum to be the default search engine, but how much, no one knew. Transcripts from the Oracle v. Google case proved that the rumors are now a fact, and also stated how much Google is paying. According to the transcript from a January 14 hearing, a lawyer representing Oracle claimed to the court that in 2014 Google paid Apple $1 billion through a revenue-sharing agreement where Apple and Google had an agreement in which “at one point in time the revenue share was 34 percent.” However, Bloomberg said it was not clear from the transcripts if the 34 percent referred to Apple’s take of the ad revenue share or if that is the amount of the ad revenue Google kept for itself. A lawyer for Google straightaway showed concern after the Oracle lawyer told the court about the exact percentage of revenue share, stating, “That percentage just stated, that should be sealed. We are talking hypotheticals here. That’s not a publicly known number.” Nullifying the lawyer’s statement, the magistrate judge presiding over the case at that time denied to block the information from the transcript.
Later on January 20, Google, along with Apple, then appealed to have the transcript completely sealed. “The specific financial terms of Google’s agreement with Apple are highly sensitive to both Google and Apple. Both Apple and Google have always treated this information as extremely confidential,” Google said in a filing, but why it is sensitive, Google was not clear.
Bloomberg reports that the transcript “vanished without a trace from electronic court records at about 3 p.m.”Speculations arise as to why the information was sealed. The news of the amount Google pays to Apple to be iOS’s default search engine could potentially affect its dealings with other manufacturers and businesses, but it will strike Apple more from a PR point of view. Apple has been renowned for innovative technology and the deal with Google could possibly damage their reputation a bit. Not to mention that time and time again, Apple CEO Tim Cook has slammed Google for its revenue model where the search giant profits from a user’s private data. But it now appears that Apple itself is profiting via the same user data through its revenue-sharing agreement with Google, making Apple hypocritical.