Apple’s Revenue Share from Google Search Ads Revealed at Trial
Google has been revealed to pay Apple a significant portion of its search advertising revenue, and that exact percentage has been revealed, reports Bloomberg.
Kevin Murphy, a University of Chicago professor and the main economics expert for Alphabet Inc.’s Google, testified on Monday that the tech giant pays Apple 36% of the revenue it earns from search advertising conducted through the Safari browser. This was a previously guarded number but it has finally been unlocked.
Murphy’s disclosure came during his testimony in defense of Google at the ongoing antitrust trial led by the Justice Department in Washington. The trial is scrutinizing Google’s practices in the search engine and search advertising markets, with the Justice Department alleging that Google is unlawfully maintaining its dominance in these areas.
The partnership between Google and Apple dates back to 2002, establishing Google as the default search engine in Apple’s Safari browser. This agreement has grown in significance over the years, particularly as it sets Google as the default search engine for the iPhone, the most widely used smartphone in the United States.
Both Google and Apple had previously resisted public disclosure of the details of their agreement. However, the revelation of the revenue-sharing percentage sheds light on the financial dynamics of this long-standing partnership. The Justice Department is focusing on this agreement as a key piece of evidence in its case against Google’s alleged anticompetitive practices.
While Apple touts the privacy of the iPhone and also slams Google and Android passively, it’s hypocritical because Tim Cook and company are also profiting from this search deal within Safari.
Senior Apple executives have testified at the antitrust trial, which also revealed that Google wanted to shut down Apple’s search ambitions, to remain the default within the iPhone maker’s Safari browser.