Google default search deal with Apple is worth so much to the search giant that Google pays 36 percent of its search advertising revenue from Safari to keep its search engine set as the default in Apple’s browser, Bloomberg reported.
Google and Apple opposed the disclosure of a crucial detail regarding their longstanding default search agreement. However, this closely guarded secret was revealed on Monday through testimony from Google’s chief economics expert, Kevin Murphy, as part of the Department of Justice’s monopoly trial, which is scrutinizing Google’s search business.
“Arguably the most significant revelation throughout the trial,” declared Big Tech on Trial, a source offering updates on the Google trial via X (formerly Twitter).
As reported by Bloomberg Law, Google attorney John Schmidtlein visibly reacted with discomfort when Kevin Murphy disclosed the confidential information. Initially, Google had insisted on keeping this information confidential, contending that its exposure “would unreasonably undermine Google’s competitive standing in relation to both competitors and other counterparties.”
For the Department of Justice (DOJ), which has positioned the Google-Apple deal as central to its case alleging Google’s illegal monopoly in search, this revelation solidifies the significance of default placements on iPhones for the search giant. Apple is worth
The DOJ asserts that Google’s substantial payments for default search deals are a strategic move to stifle competitors, secure user loyalty to its services, and maintain dominance in the search industry. This dominant position, according to Microsoft CEO Satya Nadella’s testimony, could be further solidified by Google’s advancements in AI. In September, an Apple executive testified that the lucrative nature of the default deal with Google even deterred Apple from developing its own competing search engine.
The exact monetary value of the portion of Google’s search advertising revenue derived from Safari remains unclear, but various estimates have been proposed. Statista’s report of Google’s advertising revenue reaching $224 billion in 2022 led Engadget to speculate that Apple is likely compensated in the tens of billions of dollars for Google’s default Safari placements.