Google is perfectly fine with paying Apple billions to keep you from using Bing
After paying $10 billion in 2020, that could jump to $15 billion in 2021.
In case you missed it, when you use Safari to perform a search, you’re actually using Google’s search engine. In fact, Google pays Apple billions for this, and that price may increase in the years ahead.
According to analysts and as reported by Ped30, Google could pay Apple up to $15 billion in 2021 to keep Google as the default search engine for Safari.
In 2020, Google paid upwards of $10 billion for this, but some analysts believe that the payment could rise to nearly $20 billion by 2022. In the report, it is noted:
We now estimate that Google’s payments to AAPL to be the default search engine on iOS were ~$10B in FY 20, higher than our prior published model estimate of $8B. Recent disclosures in Apple’s public filings as well as a bottom-up analysis of Google’s TAC (traffic acquisition costs) payments each point us to this figure
The big issue here is that with regulators looking at tech giants closely these days, this payment could eventually be seen as anti-competitive. That would stop these payments from happening in the future, and could cost Apple 4-5% in gross revenue, according to Bernstein analysts.
So, why exactly is Google paying all of this money? It comes down to data and Microsoft. By putting Google search into Safari, Google gains a ton of data and can serve ads to users, and on the flip side, the large sum helps discourage Microsoft from trying to persuade Apple to use Bing for search.
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