Currently, when iPhone users using iOS 14 type a query into the search window, Apple will display its own search results instead of the Google search results.
At the end of October, it was reported that Apple was developing its own search engine, which sparked widespread interest in the tech world. The recent antitrust investigation conducted by the US Justice Department has had a significant impact on the share prices of tech giants, especially Apple, whose share prices have fallen for a weeK.
For Apple, a tech startup in the hardware business, what purpose is it to develop search engines on their own? Will the long-term friendly partnership with Google break down?
Cooperative search, Google and Apple have many “secret transactions”
Google and Apple have a long history of partnering in search. Right from 2005, this “predestined relationship” was formed but did not arouse too much attention and controversy at that time. This may be because the iPhone hasn’t started to be a “boom product,” and in the PC era at that time, Google’s mobile search business just started.
In 2018, at a press conference, when Apple CEO Cook was asked about Alphabet’s controversial role Google, the default search engine for Apple products, he said: Their search engine is the best. ”This year, the Justice Department’s antitrust investigation into some of the major tech giants showed the public the far-reaching impact of this partnership, as well. like its importance to Google traffic and Apple’s bottom line.
To ensure that its search engine becomes the default search engine on Apple devices, Google annually pays Apple about $ 8 to $ 12 billion, which is the largest order amount Google pays. For Apple, orders represent 21% of current gross profit. The antitrust investigation against Google could disrupt the agreement between the two tech giants in the future.
If the 16-year partnership is interrupted, Apple will lose at least about $ 10 billion in net profit each year. As for Google, it also has a certain negative impact on the current market share of the search business. By setting Google as the default search engine for Safari browsers on iPhone and iPad, Google covered 36% of search queries in the US, according to the lawsuit filing. Based on this calculation, in 2019, Apple devices account for nearly half of Google’s search traffic.
Amid the potentially severed deal with Google, Apple began researching its own search engine. The US Securities and Exchange Administration argues that the move stemmed from an inability to investigate the antitrust, and the other part could have been deliberately done by Apple.
Self-developed search engine, what does Apple intend?
Long before the antitrust investigation began, Apple invested resources in search. The company employs many search professionals and regularly posts recruitment advertisements related to this field.
In 2013, Apple spent more than $ 200 million to acquire Topsy, one of the few companies with access to real-time information on Twitter. While it did not reveal its intention to acquire Topsy at the time, it seems that Apple was more interested in Topsy’s indexing and search technology than social media related products.
In April 2018, Apple hired Google Search Manager John Giannandrea, believed to be an attempt to strengthen Apple’s foundation in artificial intelligence and voice search through Siri.
Currently, when iPhone users using iOS 14 type a query into the search window, Apple will display its own search results instead of the Google search results. Apple also shows autocomplete style suggestions, highlighting how to learn from users’ most frequently used search queries.
Regarding Apple search products, Bill Coughran, former Chief Technical Officer at Google, once commented: “Apple has a reliable team. I think they have experience and depth. If they want, they can. build a more general search engine “. According to statistics from StatCounter, a basic application of the Internet, the rate of use of search engines has remained at around 80% since 2010 and ranks second among all applications.
Google’s latest financial report shows that in the third quarter of fiscal 2020, search revenue was $ 26.338 billion, up 6.45% year-on-year, accounting for 57% of total sales. precious. Compared with Google in the search business, Apple, the company that started with the hardware, is still “white board”. Apple’s iPhone sales in the third quarter of this year plunged and operating profit margins plunged.