Google could cough up $15 billion to remain default search provider in iOS

Google could cough up $15 billion to remain default search provider in iOS


Google Search on iOS and iPadOS
And that figure could rise to $20 billion in 2022.
Image: Killian Bell/Cult of Mac

Google could pay a whopping $15 billion to remain the default search provider on iPhone and iPad, according to one analyst. The figure could rise even higher, to as much as $20 billion, in 2022.

It is believed Google is willing to pay so much to ensure Microsoft and Yahoo, which may also be interesting in striking a deal with Apple, cannot break up the partnership Google has enjoyed for more than a decade.

Google wasn’t chosen as the default search provider in iOS and iPadOS simply because it’s the most popular search engine. It coughs up an increasingly significant sum to secure that status every year.

And it’s only going to get more expensive, according to Toni Sacconaghi, a financial analyst with Bernstein.

Google wants to remain first for search on iPhone

“We now estimate that Google’s payments to AAPL to be the default search engine on iOS were $10B in FY 20, higher than our prior published model estimate of $8B,” Sacconaghi wrote in a note to investors, via Ped30.

“We now forecast that Google’s payments to Apple might be nearly $15B in FY 21.” That’s around 9% of the company’s gross profits, and it would ensure a significant increase in the growth of Apple’s Services business.

Google is likely willing to pay such sums “to ensure Microsoft doesn’t outbid it,” Sacconaghi added. But it’s “not implausible” that Google could rethink its strategy later, with payments likely to reach $18-20 billion in 2022.

Regulators could step in

The note also warns that Google’s agreement with Apple is at risk of regulatory interference. As the fee becomes more and more significant, it’s not unlikely that regulators could step in to break up the deal.

But this is “likely years away,” Sacconaghi added, so it’s likely Apple will continue to enjoy the payments for now.


Daily round-ups or a weekly refresher, straight from Cult of Mac to your inbox.

  • The Weekender

    The week's best Apple news, reviews and how-tos from Cult of Mac, every Saturday morning. Our readers say: "Thank you guys for always posting cool stuff" -- Vaughn Nevins. "Very informative" -- Kenly Xavier.