Google could be paying Apple $20 billion a year to basically do nothing
It is no secret that Google is paying Apple a ton of money to remain the default search engine for its products, like the iPhone, iPad, and Mac computers. This is why unless you specify differently, whenever you search using Safari, it will use Google’s search by default.
It was previously estimated that Google was paying Apple as much as $10 billion a year, but according to financial analyst Berstein, it is believed that the number is much higher at around $18 to $20 billion a year for Apple to essentially do nothing.
If this sounds like an insanely lucrative deal, it is because it is, but it might not be something that could continue in the future. This isn’t because Google is unhappy with the amount they’re paying Apple (chances are Google is probably making more than whatever they’re paying Apple), but because of the Department of Justice in which they view it as anticompetitive behavior.
It makes a lot of sense why the DoJ might not be too thrilled with this agreement. There aren’t many companies that have the resources Google has, which means that it would be almost impossible for a competing search engine to offer up the same amount of money, if not more, to become Apple’s default search.
Prior to Google, Microsoft’s Bing was Apple’s default search, but the deal offered by Google was too good to pass up on. It was previously reported that Apple and Microsoft actually sat down to discuss the possibility of maybe Apple buying Bing from them, but those talks never made it to the advanced stages.
Source: The Register