Category : Technology
Imagine that a world giant pays billions of dollars to another world giant. We're talking about Google and Apple.
What is that payment for? A large part of the payment of 1.5 billion dollars, which is to make Google as the default search engine of Safari in the UK, has been paid so far.
According to an updated report compiled by the UK government's Competition and Markets Authority, Google pays Apple £ 1.2 billion (roughly $1.5 billion) annually.
The report says the agreement poses a "major barrier to entry and expansion" for Google competitors. The report also suggests that Apple's ability to monetize such opportunities is limited or to offer users a search engine option during installation.
Mobile Safari has made the iPhone an important source of revenue for Google's mobile advertising business, based on Google search for years, and gave Google a competitive advantage.
In 2014, a $1 billion payment was made in court documents to secure Google's default position in mobile Safari in the U.S. Analysts estimate that this amount has increased since then. Although Apple has not announced concrete figures from now on, it benefits greatly from such settlement deals, with an estimate of about $9 billion a year.
Regulators now worry that this major UK deal, which was 50 percent more than Google paid last year for a much more populated area more than six years ago for the US placement, could hinder competition.
Yes, having Google as a default browser on the systems when we purchase them, it’s most likely to stay as default for the future as well. However, additionally, Google is a company that most of the technology users see as a master of search engines. What’s more, there are some typical reflexes between people like ‘ask Google’ or ‘did you search on Google?’. This shows how Google is known for Internet users. Still, however, it’s not good that others (competitors) cannot be default browsers on devices or computers.