Google Paid Apple $1 Billion to Keep Its Search Bar on iPhones
The Oracle vs Google lawsuit is revealing some interesting details about the company’s hidden financial transactions. The lawsuit recently revealed that Google had made $31 billion in revenue from Android OS and $22 billion of the total was profit. That same case has now revealed that Google paid Apple $1 billion in 2014 as part of its ongoing deal to remain as iPhone’s default search provider i.e. to keep Google for its search bar.
More specifically, Google’s deal with Apple gives the phone manufacturer a percentage of the revenue the search engine generates through ads on Apple’s iOS devices. Both Apple and Google refused to comment on the matter. A Google witness also revealed that “at one point in time the revenue share was 34 percent.” Though, court records are not clear whether Apple received that 34 percent of the ad revenue or if that is the amount that Google kept for itself.
Google had made $31 billion in revenue from Android OS and $22 billion of the total was profit
Google’s lawyer, Robert Van Nest, wasn’t happy over the mention of these details and asked for the percentage to be kept a secret. He even tried to mask off the witness’s comment by saying “We are talking hypotheticals here. That’s not a publicly known number.” The judge refused to seal the transcript. Soon after, Apple and Google’s lawyers teamed up and went to a district court asking that revealing such details will make it difficult for Google to have another similar deal with Apple. The electronic script was subsequently removed from court records.
During the same time that this deal was made, Yahoo was pushing to become the default search engine for Apple devices. That deal was obviously not realised either because Google offered Apple more money and revenue share or because Apple considered Google search to be more user friendly. This also shows that money has a major part and a service could maintain its supremacy simply by paying for it. Google makes 4 times more from iOS users than it does from Android Users, thus the deal was critical for Google as well.
Apple receives a major chunk of the ad revenue Google generates from iOS
What’s intriguing is that the information highlights Apple’s hypocrisy on the matter. Apple makes such big amounts indirectly and directly from Google’s ad business, the same one that it criticises. The revenue-sharing agreement reveals how important it is for Google to maintain its top spot as a search provider. It also shows that Apple benefits from Google’s ad business despite regularly calling it a privacy nightmare.
All this information was revealed because Oracle has filed a legal case against Google for using its Java software in Android development without any monetary compensation. Oracle could end up getting $1 billion in damages if Oracle wins the case.