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Google Pays Apple $3 Billion Per Year To Remain On the iPhone, Analyst Says (cnbc.com)
In a note to investors on Monday, Bernstein analyst A.M. Sacconaghi Jr. said Google is paying Apple billions of dollars per year to remain the default search engine on iPhones and iPads. "The firm believes that Google will pay Apple about $3 billion this year, up from $1 billion just three years ago, and that Google's licensing fees make up a large bulk of Apple's services business," reports CNBC. From the report: "Court documents indicate that Google paid Apple $1 billion in 2014, and we estimate that total Google payments to Apple in FY 17 may approach $3 billion," Bernstein analyst A.M. Sacconaghi Jr. said. "Given that Google payments are nearly all profit for Apple, Google alone may account for 5% of Apple's total operating profits this year, and may account for 25% of total company OP growth over the last two years."
That pays for a lot of gender reassignment operations.
pocket change. creimer makes this much in ONE weekend shilling his Amazon affiliate links!
Sucking on my DAMN balls is free and u get protein for it
I presume G has done the ROI calculation of gaining iDevice search ad revenue, and it is estimated to have increased by more than that $3B, but I really think G would be better off letting Apple default to using Bing for a year. The Android eco-system (and the Pixel group) will love the increased customers.
They've gotten a bit too big for their britches. iOS/iTunes should be spun off into a different company while Apple concentrates on hardware. Mac OS X and iOS will end up on non-Apple hardware the same way Windows and Android do.
The downside is that capitalism in this case serves the highest bidder for the product, and the product is not the search engine--it is your eyeballs. As a result your phone becomes optimized for its ability to sell you things, so long as it maintains an adequate level of utility. This also hurts people who are less good than you at filtering and recognizing and discounting advertisements.
Apple can't make their own search engine for the same amount?
I mean you can hire the top 500 experts on the technology to make a search engine and pay them $4 million a year and still have $1 billion left over for the required data center and computing power. If you can't have a decent Google competitor within 3 years then you suck.
Or we will switch our users to Apple Maps. And you will never see any of us again.
Have gnu, will travel.
Look, let's be honest here. If Yahoo or Bing were the default search engine on the iPhone, everyone would have already switched to Android by now.
If google wasn't the default, what search engine would iOS users actually use? My guess would be google. What other option is there? Bing? Yahoo? This sounds like a waste of 3 billion for Google.
Google knows it will more than make up the $3 Billion from Apple users so it is willing to spend that money.
It has been shown time and time again that Apple users are more willing to buy stuff, therefore the ads to Apple users are worth more to Google and the people who place the adverts.
"Bernstein analyst A.M. Sacconaghi Jr....Bernstein has an outperform rating on Apple with a price target of $175."
I'm not convinced, there's no reason for the fee to triple. It sounds like Apple ARE shopping around, and trying to convince MS to pay more than $3 Billion for the search rights, and this is part of that marketing. Or perhaps it's just Bernstein trying to hype up the stock.
Either way, he would have no special knowledge of the contract and his claim of tripling while Apple's market share is falling sounds false.
replace with duckduckgo
For all we know, Google may be making more via Apple products than Android.
I am pretty sure they aren't blowing $3 billion a year on Android. At least I hope not .. it's certainly not showing.
Nice to get an inside look at how the invisible hand helps the market decide.
Sheesh, evil *and* a jerk. -- Jade
My wife is on the iphone all year long too, and she doesn't get paid a cent :(
Slashdot: providing anti-social weirdos a soapbox, since 1997.
Apple may also be helping Google track users. I signed up for a trial of YouTubeTV on iOS, and my login magically appeared in Google Maps even though I’ve never logged into Google Maps before. Shocking
And of course, there’s the Google-owned Waze app that can (and will) track you even when it’s not running. Even if you’ve killed it. Why does Apple let that happen? A: $$$$$
Pretty much every famous app works fine on Android and much user friendlier and near extinct windows phone. The day google pulls out its maps application, a lot of people will stop buying iphones. For similar reason why I am not so happy with windows phone.
You're wasting your money Google.
If Google can pay that much you know they are more then making that up. Being default is very important considering how many people would never bother to change it. In the US you could switch to Bing and never miss Google search. But beyond the US Google still rules the search engine space and does so because they pay to play.
He said in jest.
Of course news about a fake are Fake News.
don't give apple money. yahoo and MS should also not give apple money. let apple figure it out for themselves.
Are they looking to change it in iOS 11? Because Bing has been the default for a long time now...
my last two iPhone and this iPad both defaulted to bing... everything Siri does has the powered by Bing logo... have to explicitly say "search google" to get her to do it
I'd like to see Google's reasons for this. I don't believe they think a significant number of people would choose something else if they didn't pay. Or maybe most people are so lazy or care so little that they would leave whatever the default search engine was.
This is not money for access but rather to make sure Bing can't have the default spot.
Some drink at the fountain of knowledge. Others just gargle.
Three billion dollars per year? Wow. Given that no company ever does anything unless it makes them money, is there anyone left who still thinks there is no value in collecting every person's private information and selling it to whomever will pay?
These days it seems the only way to exercise one's right to privacy is to disconnect from the internet, avoid any and all rewards and miles programs, pay for everything in cash, and live in a cave. How did this happen to the United States of America?