“Would I be right in saying that, at least today, Apple has a lot of leverage in its negotiations with Google?”
Justice Department attorney Adam Severt asked Google’s head of product partnerships Joan Braddi that question yesterday, after a lengthy tour of Braddi’s dealings with Apple during her more than two-decade career at Google. The two were in a courtroom in Washington, D.C., where over the past few weeks, the historic United States against Google The antitrust lawsuit has litigated every corner of the search industry.
Braddi’s answer was pretty simple. “Yeah.” Severt continued: “Can you think of another search partner that might have more influence than Apple?” “Not suddenly, no,” Braddi said.
This exchange reiterated what has become one of the central themes of the trial so far: the overwhelming importance of Apple to the search. Much of the test has to do with the deals Google signs with many companies, from browser makers to wireless service providers, to be the default search engine on their platforms. But there is no deal more important, more lucrative or more industry-defining than the deal between Google and Apple over Safari.
Apple has established Google as the default search engine in Safari across all of its products for more than 20 years, since the browser first launched in 2003. Over the years, the agreement has morphed into a revenue sharing system. revenue in which Google reportedly pays Apple more than $10 billion a year will remain the default. That money or the fact that Google is the best search engine (or some combination of both, depending on who you ask) has prevented Apple from creating its own search product, switching to a Google competitor, or allowing Users choose a browser whenever they want. They set up their phone.
Virtually anyone you ask about the Apple deal says they would give anything to be a part of it. “They are basically kings,” Microsoft CEO Satya Nadella said in testimony earlier this month. Gabriel Weinberg, CEO of DuckDuckGo, he told the court that switching even Apple’s default private browsing to its engine would have increased DuckDuckGo’s market share “several times.”
Google knows the importance of this agreement better than anyone. And the Justice Department has shown that even Google finds the power of its alliance with Apple uncomfortable. When current CEO Sundar Pichai was running the nascent Chrome browser in 2007, in an email to Larry Page and Sergey Brin he worried about the “optics” of the deal. “I know we are insisting on non-compliance, but at the same time I think we should encourage them to have Yahoo as a drop-down option or some other easy option,” he wrote, according to evidence shown in court. “I don’t think it’s a good user experience or the optics are great for us to be the sole provider of the browser.”
“I don’t think it’s a good user experience or the optics are great for us to be the sole provider of the browser.”
Technically, Google is not the only option. Apple users can change their default search engine to Yahoo, DuckDuckGo, Bing, and Ecosia, and many third-party browsers can also be set as the device’s default. Apple and Google argue that it is easy to change (Apple’s Eddy Cue recited the steps during his testimony), but the Justice Department and others have argued that the change is difficult and irrelevant. People don’t change, they argue. That’s why defaults are the only thing that matters. (Apple says it doesn’t know if people switch because it doesn’t collect that information for privacy reasons.) And while Google has been arguing that people can and do change, evidence throughout the trial has shown that Google itself knows exactly how much defaults matter. In an internal study that has arisen in United States against Google, the company found that people who changed their browser home page to Google logged 55 percent more searches per week and fewer visits to other search engines. “The choice seems influenced by convenient access to the search box,” they wrote, “often determined by the default home page.”
Why is the deal with Apple in particular so important? It’s like Oprah said: a billion pockets, y’all. Becoming the default search engine in Safari is a sure way to achieve massive global scale. But the test makes it clear that it’s not just that more users mean more searches, more ads mean more money. Apple is a dominant player in the mobile sector in particular: it owns about half of the smartphone market in the United States and, globally, it is the only significant competition for Android, which, of course, Google already owns and controls. The only way any competitor could quickly access many millions of users, and therefore the most important moat Google must protect, is through Safari on iOS.
The first thing any search engine needs to be great is searches. The more people search, the more the company behind the engine can know what they are looking for. You can identify common (and uncommon) spelling mistakes in queries and more accurately direct people to the right place, you can discover that people who type “spiderman holland” are searching for Tom Holland and not Dutch superheroes, and you can see where people go when they write things that the engine has simply never seen before. More searches lead to better searches, plain and simple. And Apple is one of the largest search portals in the world.
By the way, this is not a new or controversial position. Nadella said on the stand that she has been trying for a decade to make Bing Apple’s default, even offering Apple every economic advantage, just to increase what she called “the flow of inquiries.” In 2009, then-Google executive Marissa Mayer wrote in an internal email that “you get better as you have more users; that’s why we have the best spell checker, the best custom search, the best improvements, etc.” The best Bing has been able to do is power Yahoo searches and get the data that goes with them, but that pales in comparison to Google’s mobile traffic.
Over the years, as other companies have pushed to become Apple’s preferred partner, Google has resisted everything Apple did that might lead users to search less on Google, including the introduction of new functions similar to search. In iOS 8, for example, Apple added “Featured Suggestions,” which appeared when you started typing in Safari’s search bar and redirected you to websites, App Store results, and even Maps locations. A Google internal presentation The change was said to result in both loss of consultations and loss of income. “Simply put: it’s bad,” reads the first slide of the presentation.
Apple considered partnering, investing in or even buying Bing
Apple had at various times considered several different search options, according to what John Giannandrea, a former Google executive who now heads up machine learning and artificial intelligence at Apple, testified during the trial. At one point, CEO Tim Cook was presented with four potential options: turning Siri into a more comprehensive search product; collaborate on a Knowledge Graph-based platform with Microsoft; invest directly in Bing and make it a native search product; or acquire Bing from Microsoft. All of those options came with two concerns: competing directly with Google’s excellent search product and the fact that doing so would almost certainly end the billion-dollar revenue-sharing agreement between the two companies.
Finally, in a 2016 amendment to the search agreement between Google and Apple, it was agreed that Apple “could not expand beyond what they were doing in September 2016 (as we did not want them to reduce traffic),” as Braddi said . in an email from 2018 to a colleague. Part of Google’s argument to Apple was about the quality of Apple’s suggestions (people searching for insurance probably don’t want a Wikipedia page about insurance, which is what they were getting), but it’s clear that even the overwhelmingly dominant search engine was obsessed with making sure you still get as many queries as possible through Safari’s search bar.
We’ve heard it time and time again over the first few weeks of this test: there’s virtually no price that isn’t worth paying to be Apple’s default search provider. Nadella said he’s willing to spend up to $15 billion a year just to get Bing in the search bar and said he’s absolutely certain the increase in usage would make Bing as good as Google in no time. time. Google, as Braddi acknowledged on the stand this week, is greatly lining the pockets of its main mobile competitor just to remain in the default position. A lot of search hopefuls, from DuckDuckGo to Neeva to Brave, are simply waiting, waiting for judge Amit Mehta to give them a chance to enter.
United States against Google It’s not directly about the history of Apple or the future of search. But it has revealed a fascinating alternative universe in the technology industry. Search, as Nadella said in her testimony, is “the organizing layer of the web.” Today, that layer looks like Google. But it seems plausible that if Google and Apple didn’t have a fabulously lucrative and mutually beneficial search deal, the search market (by far the largest tech business) could look very different. If Apple had invested in Siri or bought Bing, if DuckDuckGo were a more formidable competitor, if the hundreds of billions of dollars in search advertising were spread across Silicon Valley instead of concentrated in Google’s coffers, we could use the Internet completely different ways.
Google has been Safari’s search engine for two decades. And looking back at this era of technology, it may turn out to have been the biggest Internet land grab of all.
