Google CEO Sundar Pichai has confirmed that the company pays Apple 36% of its Safari search revenue.
The search engine shares this revenue, which is reportedly worth $18 billion, in exchange for default status on all of Apple’s devices.
Pichai made the admission while being cross-examined at the Epic Games antitrust trial, after a Google witness at the federal antirust trial let the statistic slip.
Google’s lead lawyer John Schmidtlein “visibly cringed” when the exact percentage of ad revenue paid to Apple was revealed – a figure that had previously been a closely-guarded secret, reports Bloomberg.
Why we care.
Google argues in the antitrust trial that it’s the best search engine due to superior quality, not anti-competitive practices. Yet, the question arises: if Google is truly the best, why spend billions to maintain default status? The answer could be pivotal in determining the case’s outcome.
What happened? Google’s final witness at the federal antitrust trial, Kevin Murphy – an expert economist and semi-retired University of Chicago professor, accidentally disclosed how much Google pays Apple while being questioned on the stand. The number was supposed to remain confidential as both Google and Apple had objected to details of their agreement being shred with the public. Google argued that making this information public “would unreasonably undermine Google’s competitive standing in relation to both competitors and other counterparties.”
Why this matters to Google. The DOJ argues that Google’s agreement with Apple shows it’s unlawfully keeping control over search and advertising. If the DOJ wins its case, a court order could stop Google’s unfair practices, possibly leading to the company’s breakup.
Deep dive. Read our Google antirust trial updates for all the latest developments from the federal court case.
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