Apple just ensured a gigantic source of revenue from its recently released iPhones and other devices. Now it seems that they are about to bag another huge deal, and this time with fellow tech giant, Google.
According to research and finance firm Goldman Sachs , Google could be paying Apple as much as $9 billion to retain its position as the primary search engine. And the shocking part is, the hefty 9 billion dollar amount is just for 2018! Google might also have to shell out $12 billion next year to remain the default search engine in Apple devices like the iPhone and iPad.
A Goldman representative quoted that
“We believe this revenue is charged ratably based on the number of searches that users on Apple’s platform originate from Siri or within the Safari browser,”
Apple’s game, Google’s name
Google has been the most popular search engine and browser ever since it was invented. It is 2018 now, and in order to retain the top spot, it is notorious for shelling out such amounts to stay the default engine on third-party devices.
It has reportedly already paid $3 billion in 2017. Since both the companies have remained closeted about the amount and its previous dealing, the claim by Sachs cannot be fully considered. Google has been the best search engine for Apple devices. Alternatives like Bing and Yahoo have been criticized for sub-par results when used on Siri.
Apple’s revenue from services
According to reports, licensing fee’s like that of Google’s has been the main driver of the company’s growth. Such fees account for 24% of the services business. AppleCare accounts for 17% of the $31.3 billion in services revenue that Apple collected in 2017.
“We believe the transformation to services, led by growth in both installed devices and service revenue per device, is tracking better than investor expectation,” JPMorgan analyst Saymik Chatterjee wrote in a note on Thursday.
The Google-Apple deal might get finalized in the upcoming weeks.