The article delves into the intricacies of a failed attempt by Microsoft to sell its search engine, Bing, to Apple in 2018. Google, which pays Apple a substantial amount to be the default search engine, allegedly played a role in blocking the deal. According to reports, Apple raised concerns about Bing’s search quality, advertising capabilities, and monetization strategies, leading to the rejection of Microsoft’s proposal.
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Google contends that this failed sale highlights Bing’s inferiority as a search engine rather than any unfair practices by Google in the search market. Apple’s senior vice president of services, Eddy Cue, pointed out that Microsoft’s search quality and investment were not on par with Google’s, and their advertising organisation was subpar.
The search engine competition intensified as Microsoft allegedly approached Apple multiple times between 2009 and 2020, suggesting Bing as the default search engine for Apple’s Safari web browser. However, Apple consistently turned down these proposals, citing concerns about Bing’s performance quality.
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Microsoft, on the other hand, denies the quality issues, asserting that Google was responsible for blocking the sale. Mikhail Parakhin, Microsoft’s CEO of Advertising and Web Services, claimed that Microsoft offered Apple more than 100% of revenue or gross profit to make Bing the default search engine. Still, Google’s influence, backed by a significant financial agreement with Apple, allegedly thwarted Microsoft’s efforts.
The Department of Justice (DOJ) is involved in this intricate web of negotiations and accusations. The DOJ claims that Google’s financial agreement with Apple, amounting to around $10 billion annually, is a pivotal factor in maintaining Google as the default search engine. Apple’s senior executive, Eddy Cue, reportedly testified that without these massive payments from Google, Apple would have developed its own search engine.
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According to estimates, Google might pay Apple as much as $19 billion in the current fiscal year. The Justice Department argues that these substantial sums of money influenced Apple’s decision to reject a potential joint venture with Microsoft. This legal battle between Google and the DOJ is crucial, with the latter alleging that Google utilizes unfair tactics to uphold its position as the leading global search engine. If Google can demonstrate the superiority of its search engine, it may strengthen its case. However, if it loses, Google could lose its automatic default search engine status on popular Apple products, posing a potential threat to its dominance in the search market.
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Market share statistics further underscore the significance of this legal battle. The U.S. Justice Department claims that Google commands a staggering 90% market share in search, while Bing lags significantly with only 3% of the global market share, according to Stat Counter.
In essence, this saga involving Microsoft, Google, and Apple paints a complex picture of power dynamics, financial agreements, and accusations within the search engine industry. The outcome of this legal battle has far-reaching implications for the future digital marketing landscape of search engines and the competition therein.
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