The most profitable agreement in technological history has just changed its rules of the game. Google can continue paying Apple for being the predetermined search engine in Safaribut you can no longer shield that position with an exclusivity contract.
Why is it important. Judge Amit Mehta has allowed Google to continue its payments to Apple and other distribution partnersbut with a fundamental condition: they will not be able to condition those payments to exclusivity. The company may pay to appear pre -installed, but it will not be able to prevent its competitors from doing the same.
In figures. Google pays more than 26,000 million a year for these distribution agreements, with Apple as the main beneficiary.
- For Google, it is an investment that is worth it: about 40% of its searches in the United States arrive through Safari. And the agreement serves as a deterrent so that Apple does not throw its own search engine.
- For Apple, it represents practically pure income that are direct to your results account.
New rules. Apple is now in a privileged position. You can keep Google as a predetermined option if you are still the one who pays best, but you can also offer that position to Microsoft with Bing, to Perplexity or even several search engines at the same time. It is the passage of a forced marriage to an open market.
Smartphones manufacturers are free to preinstall or promote other search engines next to Google’s. Samsung could offer Bing as an outstanding alternative. Mozilla could diversify his options in Firefox.
Between the lines. The judge’s decision speaks of a concern for the future rather than for the past. Mehta repeatedly mentions the boom of the generative AI and how Chatgpt The competitive panorama has changed. He did not want to intervene too much in a market that is being “rapidly transformed” by new actors.
This caution has saved Google from a greater evil. Justice asked for the forced sale of Chrome and much more severe restrictions. The judge considered that it would be “very complicated and risky”.
- The market has celebrated the decision with 8% increases in Google and 4% in Apple.
Turning point. This failure marks the beginning of a new era in the distribution of search engines. Apple can now experiment with hybrid models:
- Google for general searches.
- PERPLEXITY FOR IA Consultations.
- Specialized search engines for concrete niches.
Or simply stay with who pays more at all times.
The threat. For Google, the risk is not only to lose exclusivity but also face a permanent auction.
- If Microsoft decides to bet strongly to conquer safari, the costs could shoot.
- And if Apple decides to diversify options, Google would lose control over an important part of its traffic.
The true winner of this sentence is not Google, who has dodged fragmentation but loses his fort. It is Apple, who maintains its huge income and earns the freedom to choose the best bidder at all times.
Tim Cook has just seen how his most lucrative business becomes even more valuable.
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