Google has been paying Apple to be Safari’s default search engine for years, with the company regularly writing multi-billion dollar checks to keep its place. An agreement that does not please the American justice system: it has just ruled that such an agreement is contrary to antitrust legislation. Google has a monopoly and has acted as such to maintain it. “, Justice Amit Mehta said in a ruling 286 pages.
This place brought in $20 billion to Apple in 2022 alone. Image MacGeneration.
The U.S. Department of Justice filed a lawsuit against Google several years ago, accusing the company of monopolizing online search and advertising. Google’s distribution deals lock up a significant portion of the search services market and undermine rivals’ room to maneuver “, the judge wrote in his report. He added that such contracts have allowed it to constantly increase prices for online advertising. Google currently has a 95% share of the smartphone search market.
The Google/Apple deal was a key point in the case: Apple was reportedly paid $20 billion in 2022 alone, a sum confirmed by Eddy Cue. The judge rejected Google’s argument that its deals with phone and browser makers (like Apple) were not exclusive contracts. The prospect of losing the tens of billions in revenue guaranteed by Google – which currently costs it little or nothing – is dissuading Apple from launching its own search engine when it has the capacity to do so. ” he wrote.
Apple and Google risk big in Justice Department lawsuit
It’s hard to say what the ruling means for Google right now, with the sanctions decision coming later in the proceedings. It could all lead to measures that force Cupertino and Google to revise the contract — a blow to Apple, which could be forced to turn down a big annual check. Alphabet already plans to appeal.
