Google Paid Apple $1 Billion to be Default Search Engine in iPhone
In 2012, Apple gave up on Google maps to introduce their own in-house app for navigation. However, the company is staying with Google as their default search engine as latter pays Apple a lot of money to enjoy that privilege. The figure, to be exact, is $1 Billion. This figure surfaced in court transcripts from Oracle, the famed Java makers, that filed a lawsuit against Google, as per a recent Bloomberg report. According to Oracle's claim, Android operating system was built on Java platform and the company never paid anything to Oracle. They have been fighting for the damages in the court since 2010. Now Oracle is revealing the business secrets of Google for the world to see.
Apple and Google have always kept the details of their revenue-sharing agreement under tight control and the figure of $1 Billion was never revealed before the court transcript came to light. "The specific financial terms of Google's agreement with Apple are highly sensitive to both Google and Apple," Google said in a court filing on Jan. 20, according to Bloomberg. "Both Apple and Google have always treated this information as extremely confidential," reports Mac World
Analysts such as Morgan Stanley have mentioned this number in the past but this is the first time that the reference to this figure has been made in court documents. "It's a very lucrative business to be the browser of choice on a device or the search engine on a device," Chris Green, a technology analyst at consultancy firm Lewis, told the BBC. "It really does, I think, highlight the importance that's being put on being able to own real estate and the conduits through which people access information." However, Mr. Green also noted that this is not entirely unheard of for the companies to pay hardware vendors some premium to place their software and service on their device. Sometimes companies also work on revenue-sharing model.