Apple and Google: The multimillion dollar search-engine agreement

Did you know Apple does have an agreement with Google that it will not build its own internet search engine as long as Google pays it to be the default choice in Safari?

Apple and Google both are two powerhouses in the tech market. Two companies are extremely self-sufficient by themselves.

Yet why do they have to agree on such an agreement?

Well, for starters, you can read this article to find out…

What is a search engine?

A search engine can be described as a type of software application that aids users in finding the information they're searching for on the internet by using words or keywords.

Search engines can provide results rapidly--even with millions of websites on the Internet constantly indexing each webpage they discover.

If a user types in keywords, the search engine scans the titles of the websites as well as the content and the keywords it has indexed, employing algorithms (step-by-step actions) to create an index of websites, with the most relevant ones at the top of the listing.

Businesses use Search Engine Optimization (SEO) to help search engines identify their sites as being highly relevant to specific queries. The most popular search engines are Google, Bing, and Yahoo.

The Grand Agreement

New class action claims that Apple has signed an agreement with Google that it will not develop its search engine for the internet so long as Google will pay it to be the default choice in Safari.

The lawsuit was filed in the California court earlier this week. It was filed against Apple, Google, and their respective CEOs. This lawsuit claims that the two companies have an agreement to not compete for the business of internet search, which violates US antitrust law.

Particularly specifically, this complaint is a charge against Apple CEO Tim Cook and Google CEO Sundar Pichai for taking part in "regular meetings in secret" where Google will be able to share the profits it earns with Apple in exchange for special treatment on its devices, such as the iPhone and iPad.

The class action claims that Google is obligated to pay Apple annual multi-billion dollar payments as part of an agreement that Apple will not launch its own rival web search service and that the non-compete agreement contains plans to actively block smaller competitors and acquire existing or potential competitors.

The complaint asserts that advertising rates are in turn greater than rates that would be under a competitive system.

Therefore, it is seeking an injunction against an agreement on non-compete that was signed between Google and Apple, in addition to a revocation of the profit-sharing arrangement and preferential treatment, as well as the termination of the multi-billion dollar payment.

The complaint also demands "the breaking up of Google into separate and distinct businesses and the breaking up of Apple into independent and separate companies, in line with the precedent set by the dissolution of the Standard Oil company into Exxon, Mobile, Conoco, Amoco, Sohio, Chevron and others."

It's not a secret that Apple and Google have agreed on a substantial monetary arrangement that guarantees Google's status as the search engine of choice on Apple devices.

The two companies haven't yet disclosed the exact amount Google will pay to become its default browser on Apple gadgets across the United States, the United Kingdom, and other countries. However, it's speculated to range in the millions.

The year 2020 is when The New York Times stated that Apple receives between $8 and $12 billion annually as a reward for making Google its default web search engine on its devices.
According to one analyst, Google's payment to Apple in 2021 to maintain the status quo could be as much as $15 billion.

Apple and Google will likely say that, while the payments are made for Google to be the default search engine, Users can choose other search engines within Safari, such as Microsoft's Bing, Apollo Fund's Yahoo, and the various independent search engines, DuckDuckGo and Ecosia.

Winding Up

As of now, both Apple and Google maintain complete transparency regarding the agreements they have reached. But, it's not impossible for Apple to one day to make a U-turn and release a search engine.

As we all know Google itself makes smart devices as Apple does. So, it wouldn’t be a big task for Apple to design a capable enough search engine like Google.

But, even if they do so, will it be as successful as Google?

Well, it might, but we will never surely know until something like this happens.