• Home
  • Apps
  • Apps News
  • Apple Search Engine Deal With Google Creates 'Barrier to Entry', Says UK Regulator

Apple Search Engine Deal With Google Creates 'Barrier to Entry', Says UK Regulator

The US Competition and Markets Authority said the arrangements between Apple and Google create "a significant barrier to entry and expansion".

Share on Facebook Tweet Snapchat Share Reddit Comment
Apple Search Engine Deal With Google Creates 'Barrier to Entry', Says UK Regulator

Photo Credit: Reuters

Regulators said enforcement authorities should be given a range of options to address the arrangement

Highlights
  • Apple and Google did not immediately return requests for comment
  • Apple generates about $9 billion per year from licensing arrangements
  • Apple told regulators that monetisation restrictions will be very costly

The payments by Alphabet's Google to Apple to be the default search engine on Apple's Safari web browser create "a significant barrier to entry and expansion" for Google's rivals in the search engine market, the UK markets regulator said in a report released on Wednesday.

Apple received the "substantial majority" of the GBP 1.2 billion (roughly Rs. 11,219 crores) that Google paid to be the default search engine on a variety of devices in the United Kingdom in 2019, according to the report.

The UK Competition and Markets Authority, in its final report investigating online platforms and digital advertising, said the arrangements between Apple and Google create "a significant barrier to entry and expansion" for Google's rivals in the search engine market. Those rivals include Microsoft's Bing, Verizon Communications-owned Yahoo and independent search engine DuckDuckGo, all of which also make payments to Apple in exchange for being search engine options on its devices, the report said.

"Given the impact of preinstallations and defaults on mobile devices and Apple's significant market share, it is our view that Apple's existing arrangements with Google create a significant barrier to entry and expansion for rivals affecting competition between search engines on mobiles," the regulators wrote in the report.

Apple and Google did not immediately return requests for comment.

Bernstein analyst Toni Sacconaghi earlier this year estimated that Apple generates about $9 billion (roughly Rs. 67,349) per year globally from licensing arrangements, revenue with gross margins above 90 percent and with about 80 percent of the total coming from Google. Apple reports the revenue in its services segment, which investors are looking to for growth as consumers slow the pace of iPhone upgrades.

In the report, the UK regulators said enforcement authorities should be given a range of options to address the Apple-Google arrangement, including requiring "choice screens" in which users decide which search engine to set as a default during device setup or restricting Apple's ability to monetise default positions.

Apple told the regulators that monetization restrictions would be "very costly," according to the report.

© Thomson Reuters 2020


Why do Indians love Xiaomi TVs so much? We discussed this on Orbital, our weekly technology podcast, which you can subscribe to via Apple Podcasts, Google Podcasts, or RSS, download the episode, or just hit the play button below.

Comments

For the latest tech news and reviews, follow Gadgets 360 on Twitter, Facebook, and Google News. For the latest videos on gadgets and tech, subscribe to our YouTube channel.

Further reading: Apple, Google, Google Search
Samsung Galaxy Note 20 Ultra Alleged Live Images Surface Online, Periscope-Style Lens Tipped
Poco M2 Pro vs Poco X2: What's the Difference?

Related Stories

 
 

Advertisement

Advertisement

© Copyright Red Pixels Ventures Limited 2020. All rights reserved.
Listen to the latest songs, only on JioSaavn.com