Report: Google Paying $100M for iPhone Search Deal

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Although reports have appeared suggesting Apple is developing a “skunk works” focused on developing its own search engine, the Cupertiono, Calif. company has 100 million reasons to stand pat. The company receives $100 million each year from Google as part of a revenue-sharing agreement placing the Mountain View, Calif. firm’s search engine on iPhones, according to an anonymous source.

Apple is “getting over $100 million a year from Google in its revenue share deal, according to our source,” writes Silicon Alley Insider. Earlier this year, BusinessWeek reported Apple might throw Google overboard, using Microsoft’s Bing for the iPhone.

The revenue, while not significant in terms of its $15.6 billion reported in January, is still enough for the company not to expend resources to compete in what the source termed a market already with “too many options.”

As Apple and Google compete on more and more fronts, agreement is becoming ever more difficult. When Apple first introduced the iPhone, a pact to offer Google Maps took just two weeks to hammer out. But the same deal for the later iPhone 3G and 3GS required six months. Those talks were “full of acrimony” as Apple kept rebuffing Google attempts to gain more access to the map data, according to the anonymous source.

[Via Silicon Alley Insider]