Bloomberg reports reveal that Google pays Apple $1 billion yearly to remain as Safari’s default search engine. This is the same figure Microsoft dedicated to charity.
An Unexpected Exchange Between Competitors Google and Apple
At least in 2014, Apple received exactly $1 billion from Google. The nature of the two giants’ relationship is still vague, but Macquarie Capital analysts estimated that Apple gets around $1.3 billion every year in search revenue from iOS devices. Morgan Stanley also weighed in, and researchers added that there could be a per-device payment in place to Apple that amounts to the yearly $1 billion without revenue share.
Turns out, there is some revenue share involved. It has been confirmed that there is 34% revenue share between the companies, but the documents don’t detail who gets the share. The best guess is Apple.
A report from last year out of Goldman Sachs estimated that Google earned about $12 billion in mobile search revenue. 75% of those figures come in from iOS devices. If this holds true, then Apple may have gotten more than $1 billion in 2015. The contract between both corporations is in full swing, although Microsoft and Yahoo are rumored to be getting into the race to become a new default search engine.
Deals Between These Competitors Are Mostly Kept on the Down Low
There were no other public statements released about the deals regarding Safari. It may have been renewed in 2015 in a covert meeting. Analysts do insist that Google might actually be better off without this kind of exclusivity deal with Apple since they might benefit from getting ‘switchback’ users.
Google Chrome is one of the most widely used web browsers in mobile and on the web. Naturally, people who use Chrome use the Google search engine. Many people would benefit from making a full switch to Chrome if Apple gets another platform as the default search engine.
Meanwhile, Microsoft Focuses on Charity
Microsoft also gave away $1 billion in cloud services to nonprofit organizations. The corporation is also gifting scholarships to a series of Historically Black Colleges and Universities. Their goal is to empower as many communities as possible, regardless of whose default search engine or web browser they are.
