Google paid Apple to maintain search on iPhone, court documents say

Details on a confidential deal between Google and Apple to keep the Google search engine on iOS devices surfaced during court proceedings.

Peter Power/Reuters
The neon Google sign in the foyer of Google's new Canadian engineering headquarters in Kitchener-Waterloo, Ontario Jan. 14.

According to a recently released transcript of court proceedings, Internet search engine giant Google paid rival Apple Inc. a rumored $1 billion to keep its search bar on the iPhone in a deal that highlights the value of search engines in the technology age.

Details on an oft-speculated 2014 deal designed to keep Google as the dominant search engine for Apple devices surfaced Friday, reported Joel Rosenblatt and Adam Satariano for Bloomberg.

Google agreed to pay Apple a percentage of profits generated by its search operation on Apple's iOS devices, such as iPhones and iPads, the attorney for Oracle, Annette Hurst, stated according to Bloomberg. She disclosed that a Google witness told her before the trial, "At one point in time, the revenue share was 34 percent."

Both Google and Apple have tried to prevent details about their search engine deal from becoming publicly available, but the numbers surfaced as part of a years-long court proceeding between Google and Oracle. Oracle sued Google in 2010, claiming that Google used Oracle's Java software without permission to design its Android mobile operating system.

Google's lawyer asked US District Judge William Alsup in San Francisco to strike the information Ms. Hurst disclosed from the record.

"That percentage just stated, that should be sealed,” said attorney Robert Van Nest, according to the transcript. “We are talking hypotheticals here. That’s not a publicly known number.”

Google and Apple have sought to keep the information out of the public eye, citing possible harm to their ability to make such deals with other companies in the future.

“The specific financial terms of Google’s agreement with Apple are highly sensitive to both Google and Apple,” Google said in its Jan. 20 filing, according to Bloomberg. “Both Apple and Google have always treated this information as extremely confidential.”

A court document with the transcript that mentioned the number vanished from the Internet on Friday afternoon, Bloomberg reported, although the court did not grant either Google or Apple's separate requests to seal that information.

Although Google has long been the default search engine on iOS, Microsoft's search engine Bing is the default for both Siri and Spotlight on Apple devices, Stephanie Mlot wrote for PC Magazine. The revealed information describes not only how much Google values search capability on iPhones, but also the relationship between it and Apple. Mike Swift wrote for the San Jose Mercury News/MCT in 2012, two years into the suit between Google and Oracle:

Google essentially gives the Android operating system away to phone manufacturers like Samsung, HTC and Motorola – a direct affront to Apple's business model. Google indirectly profits from Android through searches made from Android devices ... Given Steve Jobs' famous oath to destroy Android – "I'm going to destroy Android, because it's a stolen product. I'm willing to go to thermonuclear war on this," Jobs told biographer Walter Isaacson – it's hard to know whether [Apple CEO Tim] Cook will be more conciliatory than the late Apple founder.

The revenue-sharing deal shows that Tim Cook has been willing to work with Google, Bloomberg reported. This deal has been the subject of some speculation and even some guesses as to its value since 2014, but this is the first official reference to it in court records.

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