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Google The Almighty Buck The Courts Apple

Google Paid $1 Billion To Keep Search On iPhone (bloomberg.com) 77

phantomfive writes: As the Google v. Oracle copyright case drags on, Oracle is claiming that Android has generated $31 billion in revenue for Google, $22 billion of which was profit. Court records also show Google paid Apple $1 billion USD to keep their search bar on the iPhone. A revenue sharing agreement was in place as well. At one point, Apple got 34% of the revenue generated by Google searches on iPhones. Both companies later requested that the information be redacted from the record, but once something is released on the internet, it tends to stay there.
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Google Paid $1 Billion To Keep Search On iPhone

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  • Capitalism (Score:5, Informative)

    by The-Ixian ( 168184 ) on Friday January 22, 2016 @10:43AM (#51350113)

    Company makes money and colludes with competitor to make more money.

    Nothing to see here; Working as intended.

    • by Hylandr ( 813770 )

      I don't see Google and Apple being competitors anymore than a Giraffe is a competitor to a Beaver.

      Totally different beasts imho.

      • by Junta ( 36770 )

        They both want to do an ad network, they both sell music and mobile apps, they both provide mobile operating systems, they both push their platform for laptops. Apple felt compelled to release Apple Maps to reduce reliance on Google maps....

        Apple has not yet tried to get into Google's first business (internet search), but it seems only because Google pays them not to try.

        • Apple is ending their ad network, iAds.

          • They aren't, actually. They're only ending the app portion of it. So that means that they won't advertise apps in the app store in iAd anymore. iAd will continue to limp along for no reason that most of us can understand.

            (Here's the first line of their announcement: "The iAd App Network will be discontinued as of June 30, 2016. ")

        • Re: (Score:3, Informative)

          by macs4all ( 973270 )

          Apple felt compelled to release Apple Maps to reduce reliance on Google maps....

          BZZZT! WRONG!!! Thanks for playing...

          Nice revisionist history, there, buddy!

          Apple was FORCED to create Apple Maps because Google REFUSED to license their mapping API AT ANY COST to Apple for use with Apple's (then upcoming) Turn-by-Turn Navigation feature in iOS.

          In NO way did Apple WANT to go to the considerable trouble and expense to "map the planet" to the street-level; but they essentially had no choice if they wanted to provide turn-by-turn Navigation on the iPhone.

        • by tlhIngan ( 30335 )

          They both want to do an ad network

          Well, Apple did - they're basically abandoning iAds now.

          Probably because Google feels it's no longer necessary - remember iAds was the ONLY reason why Google was allowed to buy AdMob - the DoJ felt that Apple's iAds was a sufficient competitor in the mobile advertising space that Google's purchase of AdMob would not harm competitiveness.

          Of course, anyone who actually ran the numbers knew iAds was a joke. I don't think I even ever saw any real ads other than for apps using i

      • Re:Capitalism (Score:5, Informative)

        by jellomizer ( 103300 ) on Friday January 22, 2016 @11:49AM (#51350611)

        Well Google vs Apple vs Microsoft vs Oracle vs Samsung...
        Big companies that do a lot of things have complex relationship with each other. They have particular product lines that compete with each other, then they have other product lines that complement each other, where it is in their best interest to partner. Then there are products that uses the products of the other.

        Apple uses Googles Services which may be using Oracle's products and Samsung's components...
        and
        Samsung makes a product that competes with Apple which uses Googles Product's based on Oracle's Products...

        Depending on the product they are best partners or bitter rivals. Capitalism isn't about making friends, it isn't about making enemies. It is about making choices that will benefit you the most.
         

        • by Hylandr ( 813770 )

          So in other words it's a Giraffe, Beaver and a Oyster having a threesome...

        • by PRMan ( 959735 )

          Yep. Apple design sued Samsung for design patent infringement for $1 billion. Samsung turned around and charged them $1 billion more dollars in parts (allowed by the contract) claiming "unforeseen litigation".

          Samsung is the only one that makes a lot of these chips. Apple has to keep paying them no matter what. Apple won a VERY Pyrrhic victory.

      • When you are as big as Apple or Google, everyone is your competitor. Even your own subsidiaries.

      • I don't see Google and Apple being competitors anymore than a Giraffe is a competitor to a Beaver.

        Google and Apple compete in some markets and cooperate in others. This is normal, and healthy.

    • Really? Then why all the secrecy over the agreement...Sorry Potsy it is a big deal. It points out that business are making money off your property and you are not being compensated for it. True capitalism would pay you for your property.
      • They are not making money off your property... installing their search makes them no money, you using it on the other hand allows them to make money off of you even if indirectly.

        The problem they have isn't that people know they have a deal with apple but that putting the details of that deal out make it harder to negotiate with others. We want the same deal apple has... when you make sales like apple you can make those demands until then... not so much.

      • Because companies don't have to disclose every business deal they have to you. How much do you pay your barber or plumber or gardener? Why haven't you disclosed it before? What do you have to hide?
        • Bad analogy. Barbers, plumbers and gardeners have published advertised rates or they don't stay in business long. This is more like how much you pay your crack dealer down the street (though even they have published advertised rates sometimes).

          • Barbers, plumbers and gardeners have published advertised rates or they don't stay in business long.

            I think there is a difference confusing quoted vs published. For example, my plumber doesn't "publish" his rates but he tells up front what it is. If he didn't like me, I'm sure his quoted rate would be higher. In the case of the OP, my point is why doesn't he disclose all his private business dealings to the world and if he doesn't, what does he have to hide?

    • The number seems reasonable. Normally the person who owns the channel looks for a 60/40 split. Google has nothing without Apple's participation. As the article states it isn't clear who gets the 34%

      As for Oracle and the Java API. I wouldn't expect the same financial split. Google should probably pay a "developer license" for Java - but not based on revenue sharing. Java embedded has a per-device license fee (http://www.oracle.com/us/corporate/pricing/price-lists/java-embedded-price-list-1977272.pdf)

      • But, a large part of the problem is that Sun, the creators and owners of Java at the time, didn't object to Google creating their own version of the API. The problem Oracle is having in court is they are trying to say that since they bought Java with Sun that they can go back to the beginning when Sun still owned Java and change their decision on how Google could use the API and charge them all the back fees from when they didn't even own the company. They may have a much better argument by saying that th

    • Even if, in general, Apple and Google are competitors in many sectors, they certainly aren't here because Apple doesn't have a competing search product. Of course, when you search on the iPhone is has to go somewhere (Bing? Yahoo!) and those queries are worth money, so it's good sense to come to a revenue-sharing arrangement. That's not collusion or conspiracy, it's just a regular business deal for something of value that another party cannot produce on their own.

      By comparison, Apple cannot fab their own SO

      • Siri uses bing for search.

        I wonder how much Microsoft pays for that.

        Or if Apple does it to reduce the reliance on Google.

      • By comparison, Apple cannot fab their own SOCs so they buy them from Samsung [informationweek.com], for billions of dollars yearly. Those two are also competitors (and legal adversaries) in many sectors distinct from chip supply. That's not "collusion" either -- it's the fact that a large business has many interests and generally can keep them separated so each part of the company can function.

        Exactly!

        In fact, Samsung just committed to a build-out of fabrication facilities costing several BILLION dollars, just to supply OLEDs for Apple.

        When companies get a large as Apple, Samsung and The-Company-Formerly-Known-As-Google, they are ALL afflicted with the corporate version of Multiple-Personality Disorder. Some parts of one company are friends with some parts of the other compan(ies), some are enemies, and some are "frienemies".

    • Company makes money and colludes with competitor to make more money.

      Nothing to see here; Working as intended.

      I have a couple of questions for you: "What is the difference between a simple Agreement and 'Collusion' ?" And "How is this 'Collusion' ?"

      • The amount of money involved as well as the implied exclusion of other, competing products makes it collusion in my book.

        But again, working as intended.

        • The amount of money involved as well as the implied exclusion of other, competing products makes it collusion in my book.

          But again, working as intended.

          Listen, moron: There is no "exclusion of other competing products" going on here. You can choose among several Search Providers in iOS' mobile Safari [about.com] (including DuckDuckGo). Google is just the Default. And since most people (including me) don't bother to change the setting, you get Google...

          • And it's good that you can change this when traveling to China, as the Great Firewall prevents reliable use of Google, but Bing (at least last time I was there) worked.
  • that Google is paying Apple at all.

    I would have thought that if iPhone didn't do Google searches there would a great disturbance in the Force, as as if millions of voices suddenly cried out in terror....

    • by Tx ( 96709 )

      I'm surprised Apple hasn't bought a search engine of its own. Several decent search engines have fallen by the wayside in recent times, so I'm sure they could pick something up pretty cheap if they didn't want to create one from scratch. Sure, the $1 billion + 34% of search revenue from Google is nice, but presumably 100% of search/ad/data mining revenue would be even nicer.

      • The problem is building a search engine isn't quite as simple as it once was. Nowadays, with SEO being so aggressive, you need the ability to determine what links people actually click on at your search pagen to help you figure out what is relevant. Google initially did this with search toolbars, and now they do it with chrome itself, and now they've added some JavaScript trickery.

        Apple just doesn't have the numbers to be able to effectively do any of these. Do their users spend a lot, and generate a lot of

    • Bing is as good as Google these days (largely because Google is worse than it used to be, not because Bing is particularly great.) If Apple switched over to Bing, it'd encourage a lot of people to use the service, and realize they're not missing a lot by not using Google.

      So yeah, it's worth Google paying over the odds to get Apple to make their search engine default. They would hemorrhage market share if a sizable number of people got used to an alternative.

      • From Apple's perspective colluding with Google is probably the lesser evil to colluding with Microsoft... Even better if Google is willing to fork over cash.

      • Re:I am surprised (Score:5, Informative)

        by Overzeetop ( 214511 ) on Friday January 22, 2016 @11:19AM (#51350401) Journal

        You know, I've heard rumors of that. As an owner of a shiny new Surface, Cortana does Bing searches by default. I can say this with no reservation: Google searches, from within my Google account (I have my personal and business domain email managed in Apps accounts)*, is hands-down superior to Bing without the associated metadata. No amount of "this is the default" search engine is going to make me use an untrained/inferior search long enough to get 10 years of searching optimized.

        *If Google isn't customizing my searches, then it's just hands down better for the stuff I'm looking for, but I'm willing to give Bing the benefit of the doubt that it sucks simply because it doesn't know my history.

    • Re:I am surprised (Score:4, Interesting)

      by TheRaven64 ( 641858 ) on Friday January 22, 2016 @11:10AM (#51350337) Journal
      What percentage of users of any computer or smartphone do you think actually notice who their search provider is? These days, there are basically the small set of people that set it explicitly to DuckDuckGo and the overwhelming majority who just use whatever the default is because it's good enough.
    • Re:I am surprised (Score:5, Informative)

      by 93 Escort Wagon ( 326346 ) on Friday January 22, 2016 @11:27AM (#51350451)

      that Google is paying Apple at all.

      The summary sucks. The $1 billion was not a separate payment... it was Apple's cut of Google's iOS search revenue. And, also, it's apparently not defined in the testimony whether 34% was how much Apple keeps or how much Google gets to keep.

    • There have been persistent (though difficult to verify) stories that Google makes more money off of Apple users than Android users for years now. This isn't so surprising, since when it comes to purchases from mobile devices, more iOS users buy things, and they pay more per purchase on average.

      But more to the point, I don't think Apple has ever been in an open war with Google the way people often think they are.

      Google wants to be your search engine, and they want to be in your pocket. They don't care WHAT d

  • Larry Ellison (Score:5, Interesting)

    by monkeyxpress ( 4016725 ) on Friday January 22, 2016 @10:52AM (#51350191)
    The real story here is that Larry Ellison is still bitching about his 'stolen' Java API.
    • The real story is that Apple and Google are such good business partners...
    • Wouldn't you, if you thought you could make more than a billion dollars off it? Really?
  • When Apple was looking for a search partner they should have done more than just Google it.
  • Google Paid $1 Billion To Keep Search On iPhone

    Okay, I know you can kind of work it out from context (though you shouldn't have to), but at a glance it's not clear whether that's "Google have paid" or "Google have been paid."

    Still, it's possible that Apple could have paid Google to stop them blocking Google search from iPhones... I guess...

    • If only there was some clarification to this point either in the article or even in the summary itself.... Oh well, I guess we'll never know the answer to this...

There is hardly a thing in the world that some man can not make a little worse and sell a little cheaper.

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