To address antitrust litigation risks, Google is trying to reduce its reliance on Apple
Google is trying to reduce its reliance on Apple to address antitrust litigation risks. Currently, Google's advertising revenue from the iPhone Safari browser is subject to a 36% cut by Apple, leaving around 64%, approximately $56 billion, which accounts for a quarter of its total search revenue. Google has launched its own Google Chrome browser and is committed to increasing iPhone users' usage of its browser. Internally, Google aims to have half of its searches completed through its applications by 2030. Reducing dependence on Apple will also reduce the likelihood of court demands to terminate agreements
Facing the risk of a court ruling that Google (GOOG.US, GOOGL.US) must stop paying fees to become the default search engine on iPhones, Google is increasingly trying to reduce its dependence on Apple (AAPL.US). According to previous reports on the U.S. Department of Justice's antitrust lawsuit against Google, if the court rules in favor of the Department of Justice, Apple could lose $20 billion annually. However, a new report focuses on the potential impact of this ruling on Google and the measures the company is taking to address it.
According to reports obtained by the Wisdom Finance app, 36% of the advertising revenue Google receives from searches through the iPhone Safari browser is taken by Apple. The remaining 64% means that Google has generated approximately $56 billion in revenue from the Safari browser on iPhones, accounting for about a quarter of its total search revenue.
In fact, even before the Department of Justice filed a lawsuit accusing Google of anticompetitive behavior in iPhone transactions, Google had been working to reduce the number of searches conducted through Safari. The company launched its own Google Chrome browser and spent over a decade trying to get iPhone users to switch to Chrome.
To this end, Google has heavily promoted its browser and continuously introduced new features. Recently, these features include integrating Google's Gemini artificial intelligence technology into the browser.
It is reported that five years ago, searches through the Chrome browser or Google apps on iPhones accounted for 25%. Since then, this proportion has risen to around 30%, but internal sources say this result is still disappointing.
It is known that Google's internal goal is to have half of the searches completed through its apps by 2030. Insiders also revealed that search volume growth has stagnated since mid-2023.
With the implementation of generative artificial intelligence and TikTok-style videos, Google is trying to further persuade users to use its apps, making it more urgent for the company to meet user demands.
Reducing dependence on Apple will also reduce the likelihood of the court requiring the termination of agreements. At the same time, this will put Google in a more favorable position in negotiations with Apple next time. Additionally, there are reports that Google is already negotiating with Apple to authorize Google Gemini for iPhones