Google and Apple couldn’t be any more further from allies, but when a company has such a massive market share of devices that requires a search engine, both companies see a way for this to be a profitable professional relationship for them. How would they achieve this feat you might ask? By making sure that Google is the default search provider to all Apple devices. It is speculated that Google will pay Apple $9 billion just to maintain their position as the default search engine you see when you open up Safari, the browser bundled with all the iOS and macOS devices.
Although “Traffic Acquisition Cost” (TAC) terms are not meant for the public, speculations have cemented the belief that these are multi-billion dollar in nature as suggested by Goldman Sachs analyst Rod Hall. According to Goldman Sachs, Google might be paying $9 billion to Apple in 2018, and around $12 billion in 2019, to stay as the default search engine on Apple’s devices.
Rod believes that the amount can vary from one year to the next, depending on searches that originate from Apples platforms, as long as Google identifies that the visits are from iOS or Mac devices. Unfortunately, these numbers are really anyone’s guess and the last figure that was made public was in 2014, which was $1 billion. This number was released because of court filings, but this knowledge is kept private otherwise. Based off those figures, analysts have stated that due to the growth of Internet users, accessibility to devices, and many other factors, the number continues growing year-over-year. Apple already has more than a billion active iOS devices and has sold more than 2 billion iOS devices since the original iPhone.
The above information is definitely representative of the growth of Internet usage and Apple’s active devices. In recent years, Apple expanded its operations to more parts of the world and are still supporting older devices through regular iOS updates. There are also people on outdated iOS devices still able to access the internet, which are also a part of Apple’s and Google’s user base. This includes devices which no longer receive iOS updates Even if the user is on obsolete hardware and software, but the device is actively used, they are still a potential customer for Google.
Keep in mind, this is all speculation from analytical experts in the finance field. There is nothing solid or conclusive here for anyone to put a fixed figure or otherwise estimate the existence of this relationship between Google and Apple.
Source: Business Insider