Google Paid Apple $20 Bn To Be Default Search Engine In 2022: Report

Court documents unsealed this week disclosed that Alphabet, Google's parent company, paid Apple a hefty USD 20 billion in 2022 in a significant revelation from the US Justice Department’s ongoing antitrust lawsuit against Google. 

This payment ensured that Google would remain the default search engine on Apple’s Safari browser. The arrangement is now at the centre of allegations that Google has illegally monopolised the market for online search and related advertising.

During the trial, which captured the industry’s attention last fall, it emerged that Apple executives had vaguely mentioned payments in “billions” from Google, without pinning down a specific figure. Further clarity came inadvertently through a Google witness, who let slip that the company directs 36 per cent of its search ad revenue back to Apple. This deal, according to newly disclosed details by Eddy Cue, Apple’s senior vice president of services, is vital to Apple’s finances, contributing 17.5 per cent to the iPhone maker’s operating income in 2020.

The strategic importance of this partnership is underlined by its scale and impact, with Google paying more than USD 1 billion a month by May 2021 for its privileged position as the default search engine on the most widely used smartphone in the US.

Microsoft, operating its Bing search engine, has also been drawn into the narrative. Court filings show that Microsoft has made considerable efforts to woo Apple, proposing to share 90 per cent of Bing’s advertising revenue, a deal which also included proposals to obscure the Bing brand in an effort to secure default status on Safari. Microsoft CEO Satya Nadella highlighted the significance of such default arrangements in his testimony, labeling a potential switch by Apple to Bing as "game changing."