Source / new Zhiyuan (ID: AI_ era）
Original title: Google Apple $8 billion in bad luck: Cook chopped up Chaco's dinner, Jobs threatened to destroy Android
Foreign media reported that the US Department of justice's antitrust investigation recently focused on a lucrative deal between apple and Google. Apple can make between $8 billion and $12 billion a year. In exchange, Google is the default search engine for Apple devices and services, including the iPhone and Siri. The grudge between Google and apple has been going on since the last generation of jobs and Schmidt.
The U.S. Department of justice has been busy with antitrust litigation recently, with giants like apple and Google naturally bearing the brunt.
According to the New York Times, one of the largest antitrust cases in the U.S. government, the Department of justice recently focused on a lucrative deal between apple and Google.
The relationship between the two giants can be described as "enemies and friends" and "love and kill each other".
In a private deal, up to $12 billion of wool must be collected
On Tuesday, the U.S. Department of Justice filed an antitrust lawsuit against Google, saying it used anti competitive and exclusive practices in the search and advertising markets to maintain its illegal monopoly.
This is the biggest antitrust case of the US government in 20 years.
It is said that as early as 2017, apple updated an agreement to keep Google's search engine as the default option on Apple's devices.
One day in 2017, Apple CEO Tim Cook and Google's Sundar Pichai were photographed having dinner together at a high-end Vietnamese restaurant called tamarine. This photo also appeared in the local tabloids in Silicon Valley, causing a lot of stir. What people are interested in is the relationship between the leaders of the two giants.
The two sat by the window, drinking red wine and negotiating nervously over reports of Google's search engine as a pre selection option for Apple's iPhone and other devices. The multi billion dollar deal reinforces their dominance in the technology industry.
On the evening of August 14, 2017, Bernstein, a Wall Street investment research firm, said in a report released on Monday that Google was expected to pay Apple about $3 billion that year. The cost is likely to account for 5% of Apple's overall operating profit this year, while IOS devices account for about 50% of Google's mobile search revenue.
In recent years, the price of apple is also rising.
According to the latest report of the New York Times, apple can make between $8 billion and $12 billion a year, much higher than the $1 billion a year in 2014.
In exchange, Google became the default search engine for Apple devices and services, including the iPhone and Siri. It's considered to be the biggest payment Google makes to anyone, even 14% to 21% of Apple's annual profits.
It's hard for apple to ignore such an income.
Prosecutors said the deal was illegal, protecting Google's "monopoly" and stifling competition.
Google's search traffic is an integral part of its business model. According to the U.S. Department of justice, nearly half of Google's search traffic currently comes from Apple devices. When iPhone users search Google, they will see all kinds of search ads. They can also find other Google products, like YouTube.
Now, the deal is in jeopardy. The loss of this agreement with Apple has been described as a "Red Alert" within the company.
Similarly, Apple has been criticized for acquiescing in the deal and gaining more profits through regular renegotiation, which is considered to have contributed to this "anti competitive behavior.".
Although the two companies are rivals in Silicon Valley, the deal is said to be part of a "alliance between rivals.". Regulators say this is a serious impediment to the prosperity of other smaller companies.
Strange CP added: stories that apple and Google had to tell in those years
It's back to the stories that apple and Google had to tell. The enmity between them can be traced back to the leader of the previous generation.
As early as 2005, apple and Google signed a deal that seemed inconspicuous at the time: Google would become the default search engine for Safari browser on Apple's MAC.
Soon, cook, then Mr. Jobs's deputy, saw the potential. Google is responsible for paying, and apple just needs to provide a search engine that users already want.
Steve Jobs and Larry Page, one of the founders of Google, and Schmidt, the then head of Google, went through the company.
When Mr. jobs launched the iPhone in 2007, Google CEO Schmidt also served as an apple platform. At that time, they were intimate and like one person.
There was also a former employee who disclosed that "as soon as I entered the coffee shop, I met Steve Jobs and Larry Schmidt having lunch together. "
Larry, co-founder of Google
Schmidt joked at the time, "we can merge these two companies, called Apple goo. He is also a member of Apple's board of directors.
Jobs: Google wants to be a mobile phone? I'm going to start a nuclear war! Cook: Google search engine is the best
Then there was a time when the relationship deteriorated. Google has been quietly developing an iPhone competitor: later Android. Jobs was very angry.
In 2009, Schmidt withdrew from Apple's board of directors. The two sides broke up. In 2010, apple sued a mobile phone manufacturer that used Android. "I want to destroy Android! "
Jobs told his biographer. "I will fight to the end with my last breath. "And promised to launch a" nuclear war "against it.
In private, they criticize each other without mercy.
Cook once said that Internet advertising is the foundation of Google, which is bread and butter, but "surveillance" of consumers,
After 2011, Apple launched Siri, which is Microsoft's Bing, not Google search.
"In Silicon Valley, we have a strange word: cooperation and competition," said Bruce Sewell, Apple's general counsel from 2009 to 2017. "There is fierce competition between you, but at the same time, you also need to cooperate. "
Alphabet, the parent company of apple and Google, is worth more than $3 trillion, and there is competition in many areas, such as smartphones, digital maps and laptops.
But apple and Google are still inseparable, and both know how to get along well and maximize their interests.
Around 2017, the deal entered the renewal phase. Google is facing the squeeze of the market due to the sluggish growth of the number of hits of mobile advertising. Apple is not happy with Bing's performance on Siri. At that time, Mr. cook just announced that Apple planned to double its service revenue to $50 billion by 2020. This ambitious goal could only be achieved with the help of Google.
There is nothing better for both sides than an iPhone search deal.
"Their search engine is the best," Mr. Cook said at the end of 2018 when asked by the media why he cooperated with a company he secretly criticized. Apple has also taken steps to reduce Google's data collection, he added.
Currently, the US Department of justice is applying for a court injunction to prevent Google from reaching a similar agreement with apple. The Justice Department said it was unfair that the deal helped Google become the center of consumers' online lives. So far, Google controls 92% of the world's Internet searches.
Google's antitrust lawsuit may lead to the forced split of Google. Being forced to split up could mean that Apple has lost the opportunity to make easy money.
Google has always stressed that it can dominate the search business because consumers like it, not because they are buying. The partnership with apple is no different from Coca Cola paying for the significant shelf space of the supermarket.
Google defended itself by saying that other search engines, such as Microsoft's Bing, also signed revenue sharing agreements with apple as a secondary search option for the iPhone. Apple also added that Apple allows people to change the default search engine from Google, but few will, and many prefer Google.
Apple and Google seem to be getting closer recently. As recently as April, cook announced that apple and Google are working together to provide a new crown of data tracking services.
I don't know how the friendship between the two men will continue after this storm.