Google Could Pay Apple $1B Next Year To Remain Default Search Engine On iOS | Hacker News Reader

Google Could Pay Apple $1B Next Year To Remain Default Search Engine On iOS

techcrunch.com

27 pointsjoshmilas39 comments

This report is full of hedging. Examples from the opening paragraph:

According to a report from Morgan Stanley, Google could pay more than $1 billion in 2014 to remain the default search engine on iOS. In 2009, Google paid only $82 million for the privilege. Analyst Scott Devitt believes that it is a per-device deal growing every year.

Is there hard evidence that any of this isn't just speculation?

Doesnt seem like it? The miss-use of "To" in the HN title and in the article url is also hugely misleading when the actual title of the article is Google COULD pay Apple etc,etc

Google should let it lapse, nothing would say that iOS devices are no longer the cool thing to own then having Bing or a lousy Apple brewed search engine be the default.

Why not just present users with a choice? I imagine no more than a single digit percentage would choose something other than Google, but it'd be enough to hit them and send a message.

I'd also be interested in the potential legal angles here: since Google are competing with Apple in a separate market, are they allowed to use their position as search leader to harm Apple? (e.g. by not offering similar deals it offers to other organisations like Mozilla, knowing that Apple doesn't have a choice but to use them anyway?) I suspect not, at least now now Bing is a viable alternative, but maybe a few years ago it'd have been a different story.

If you present users with a choice, they'll still choose Google and Apple gets nothing. Make it the default, and Apple gets a cool $1B.

"A billion here, a billion there and soon we're talking about real money" ;-)

There's not that much of a difference between Google and Bing. Most of us are using Google for historical and cultural reasons - it's what we've used in the past and it's just what people like us do.

This claim is the basis for the Bing v. Google challenge (bingiton.com). I tried it, and preferred Google, mostly because I'm usually searching for technical terms.

There is enough of a difference that when I decided to test with Bing and then Duck Duck Go (Fuck that name is complicated to type) for 2 weeks each I was missing Google's MUCH better results for the same queries. In the Bing it on challenge for example, Google wins 5 out of 5 for me.

>There's not that much of a difference between Google and Bing.

Exactly why it would be damaging. People still think of Bing, etc, as second tier despite similar results.

Google are paying Apple. If Google said "no", and Apple cared, Apple could still make Google the default. Then Google would look pretty silly for previously paying them.

This is why analysts get paid the big bucks! To randomly speculate on deals that when confirmed make them look like they know what they are talking about but when nothing ever materializes it doesn't matter because no one is calling them out over it.

My parents are not tech savvy. However, they do know to 'Google' it. While they may not know how to change the home page it doesn't matter what device they are on. They go to Google to search. Even if that means finding Google through Bing.

If they are doing this.. I wonder how much value this will actually be.

Do your parents know how to change the default search engine on iOS?

The desktop is a different beast than mobile; I think most mobile users just use the "search field" and find what they want.

(Edited for typo)

Note that the GP said, "Even if that means finding Google through Bing."

I think his point was that his parents don't just use the search field -- they use google. That is, they'll search for google and then they'll search for what they want. If google ever quits paying apple, this is the bet they'll be making. Who knows if they're right.

This. I remember a phone call a while ago. My mother had taken her iPad to a hotel and "the Internet wasn't working."

I spent 5 minutes trying to get her to identify which is the url bar and which is the search bar in Safari. In the end I gave up. My mother is smart.. i swear.. she just somehow doesn't get this.

If she does accidentally use the search box it is to find Google which she almost certainly doesn't realise she is already using.

Really this is my point. Parents are deeply non-tech and it is ingrained in them to use Google whether it is the default search engine or not. I am a bit techy and I always switch the default search engine to Google.

Google paying this money doesn't do anything for my household or my parents. Between our two houses we have 5 iOS devices which are unaffected by this move. It is a tiny number but it makes me wonder how many more people are like this.

One of my favorite "easter eggs" with Yahoo search (at least on search.yahoo.com) was that until recently, if you searched for Google, it would display a second Yahoo search box in the results with a text re-iterating that you could search the web via Yahoo to try to capture these types of users.

(These days it gives a "Search the web with Google" box, and the same if you search for Bing or Yahoo itself).

I don't think users work that way on phones. Even on my android phone I just search. Now it is also true that the info I am searching for with my phone is quite different than the info I search for with my computer... I don't know... maybe that's the difference... the type of information.

Not really sure... but I am sure that it never occurred to me which search engine I used on my phone. Or even if I borrowed someone else's phone to search for something, I never gave which search engine I was using a second thought. I am absolutely CERTAIN that I have never searched for Google... and then searched for what I was looking for... even with an iPhone I never did that.

I don't know... maybe Google was always the default? Can't remember... but I seriously doubt people have time to "setup" a mobile search. That's not how I work on a phone and I suspect a lot of other people don't either.

Even for maps... I hit maps... if Google comes up... that's what I search. If Bing or whatever comes up... that's what I search. I have never looked for Google maps... or for Bing Maps. Except on the desktop because I think Bing has that perspective "Bird's Eye" thing that's pretty cool. But I never used that on a phone, because it never occurred to me.

I don't know... that's just me. I'm kind of always in a hurry though... ESPECIALLY on the phone.

I know this article is speculative, but if it's true, this is why Google built Android. I know that tech pundits like to talk about how Apple is making the lion's share of the profits in the smartphone industry (which they are). But despite the fact that it doesn't make them a lot of money directly, Android has prevented Apple from gaining a stranglehold on the smartphone market. If Apple had > 90% of the smartphone market share, they would be eating 75%+ of Google's mobile search revenue for as long as they maintained that position.

In my mind, there's never been any question that this was the purpose of Android; aside from the goal of spreading low-cost mobile computing, the business purpose was to avoid a market in which one company (known for their control freak tendencies) had utter control over the mobile OS market, in a much more locked-down manner than was the case with Windows on desktop. This would be a disaster for Google (and arguably, the consumer), as they'd have no market power (and the switching cost for a search engine is much lower than the switching cost for a smartphone). The introduction of Android was simply to ensure more competition in the market (in fact, back when Android phones had a hardware search button, you could find many phones that mapped it to Bing). Android was less about making money off the product directly than about shaping the environment of the mobile industry in a manner that was less unfavorable to Google. As another example of this strategy, see Chrome: Performance of the dominant browsers was hindering what Google could do with their products...until an alternative was launched and both Firefox and IE magically decided that performance gains were possible, and now the state of the browser market is in much better shape than it was.

It's more than a little shocking that so few people seem to understand these concepts. You still see articles (whether from Wall St or the online tech community) about how Android makes X dollars in revenue, as measured in AdMob revenue from Android phones and Google Play revenue. This is then directly compared to the estimated cost Google has put into developing it and judged to be a failure, from a business perspective.

It sounds to me like this is a per device deal. It makes sense that the number would grow annually. From what I saw in the article it doesn't make mention that Apple is extorting this money out of Google either. It seems that people see the 1 Billion dollar figure and assume something sinister is afoot. I would not doubt that this figure was the result of negotiations between the two companies.

Apple hasn't learned much from the Maps fiasco, have they? Also, Apple seems to be a lot more keen on hurting Google than on providing the best experience to their users. They did that with Maps, when they decided they'd rather give the users a poorer maps experience, than continue dealing with Google, and if Google refuses to pay this much, then they will do it with search, too.

I think the difference here is that Maps probably loses Google money, or doesn't make them very much. If this is the case, why should the pay Apple to be featured? Search is a different story, as this is where Google makes their money.

Thats really only half the story. Apple couldn't give their customers the experience they wanted to give them: Turn by Turn, no data mining, etc... while staying with Google. So they made the decision to go their own way.

Hindsight being 20/20 they should've stayed with the "subpar" google maps until their new maps were less "subpar". It's great to point out hindsight but it's hard to fault their logic that they needed to move away from Google Maps. The only thing to really nail them for is doing so before apple Maps were fully baked.

(for different definitions of subpar)

> Hindsight being 20/20 they should've stayed with the "subpar" google maps until their new maps were less "subpar".

I'd imagine widespread usage is necessary for that.

What would their alternative be to Google? Seems like users will uproar if they were to switch to bing. I'd be happy with ddg...

I'd imagine most people here (myself included) have a much better impression of DDG than they do of Bing, but I doubt that the average user would. If anything, they'd probably be _more_ turned off by DDG than Bing ("At least I've heard of Bing").

What if Google refuses to pay? Will Apple remove Google as default search engine on iOS? Recall what happend when they replaced Google maps? Nah, I didn't think so.

Clearly, someone at Morgan Stanley, who came up with this bollocks, must have been wearing their pair of Joo Janta 200 Super-Chromatic Peril Sensitive Sunglasses most of the time last year, when the maps fiasko took place.

Being the default search option everywhere is worth a lot to Google. A 2011 report says they pay Mozilla hundreds of millions of dollars to be the default search option in Firefox:

http://www.telegraph.co.uk/technology/google/8975584/Google-...

So if Google doesn't pay? Bing or Yahoo will happily pay hundreds of millions to take their place.

I notice there's quite a large discrepancy between the link title on HN and the actual article title. The "to" makes it sound like the deal is done but the article really just seems like speculation. Is this TC just desperate for more HN clicks?

To be honest wouldn't Google search disappearing from iOS devices play in google's advantage looking at their Nexus devices? I mean ... what are the odds Apple comes up with something beter, even third party?

Bing is likely good enough for the likes of my parents.

You have to remember that search is Google's core business, it's where they make their money (well, advertising really, but advertising in search).

From the sketchy article details, it seems like it's win-win for both Apple and Google. Google makes money from user searches on iOS, then shares a portion of that with Apple. The gamble is whether Google needs to be paying Apple anything at all.

I think its about time that we realize that Google is no longer the far and above better search engine for what most people search for. News, celebrities, sports, recipes, etc... these are all low hanging fruit when it comes to search. I have no doubt that Bing is on par with Google when it comes to these categories. I'm sure Google still wins massively on the "long tail" search, but these types of searches are only important to a small percentage of users. If Apple suddenly changed their default search to Bing (perhaps also removing branding), I don't think anyone would care besides the techie folks and the bloggers.

I personally believe that long tail searches will become even more important in the future with users entering their search queries via tools like Siri and Google Now.

I do not have any hard facts to support that subjective opinion, but to me it feels a lot more natural to speak out a query as a full sentence than to say a few keywords.

This seems like a great deal for Google. I mean, depending on how long the $1 Billion gets them the default search spot for, I am certain they will make the money back through ads in the near future.

the $1 Billion gets them 1 year

I think the $1 billion is in regards to how much advertising money that Apple's cut earns from google's ads on iOS devices. I doubt this is just about default inclusion of the google search engine.

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