Google pays Apple $3 Billion per year to be the default search engine on iOS.
One great thing about being in the Google ecosystem is that the company’s services are on the most popular platforms (sorry, Windows 10 Mobile fans). If I wanted to, I could pick up an iPad tomorrow and have access to my purchased books, music, movies, my keyboard, my saved locations, and browser favorites. Another way I’d feel at home on iOS is the fact that Google is the default search engine.
That comes at a cost, however. According to CNBC, Google is estimated to be paying $3 billion for the fiscal year 2017 for the privilege of being the default search provider on iOS, up from $1 billion in 2014. This deal comes with very little cost to Apple, and the revenue accounts for a large portion of the Cupertino company’s services revenue. The arrangement accounts for approximately 5% of Apple’s total operating profits for each year, as well as 25% of Apple’s growth over the past two years.
Google wins in this case as well, because about 50% of its mobile search revenue comes from iOS devices. While some more technical users would notice if Apple switched to Microsoft’s Bing service for the search engine, most users wouldn’t think anything of it. So while Google is paying a hefty amount of money each year to be the default option, not paying that money would likely mean much less revenue from mobile search. At the end of the day, it seems like this is a good working relationship for both Google and Apple, with each company gaining from the arrangement.
Do you use Google Search on an iOS device? Let us know down below!
