Will Apple push Google out of iOS?

Apple-vs-GoogleIt’s no secret that Google and Apple are not the best of friends. It wasn’t always so. They got along fine for years; reportedly in 2001, Google founders Larry Page and Sergey Brin even wanted Steve Jobs to be Google CEO. The two companies didn’t compete at that point. Google chairman Eric Schmidt was on Apple’s board for years. It all went wrong when Google launched Android. Jobs felt so betrayed he infamously told his biographer “I’m going to destroy Android, because it’s a stolen product. I’m willing to go thermonuclear war on this.”

Much has been made of the antipathy between the two since then. Apple has launched many lawsuits against Google’s Android partners, most notably duking it out with Samsung in courtrooms across the land; however, it wasn’t until Google acquired Motorola Mobility that the two went directly head-to-head. Google snapped up a lot of patents and inherited a batch of existing legal suits involving Motorola versus Apple. Many of them are on-going, but we’re not here to talk about the endless legal wrangling.

Cutting Google out

There have been signs in recent years that Apple is looking to push Google out of its lucrative iOS platform. It started with the removal of the branded Google search button from mobile Safari. Then there was the argument over Apple’s expired YouTube license, which meant no YouTube app included by default in iOS 6. Then Google Maps was dumped in favour of Apple Maps. Most recently at WWDC in June, alongside the unveiling of iOS 7, Apple revealed that Bing would now be the default search engine for its voice assistant Siri.

Google is still the default search engine in mobile Safari, for now, although you can opt for Bing or Yahoo instead. Piper Jaffray analyst Gene Munster suggested that iOS would account for 40 percent of Google’s mobile search revenue in 2012, worth about $1.6 billion. At the start of the year a report from Morgan Stanley suggested that Google may have to pay Apple $1 billion in order to remain as the default search engine on iOS in 2014. We know it paid $82 million for the privilege in 2009, but the figure has not been revealed since.

Battle for eyeballs

It stands to reason that tech companies want your attention. They want eyeballs that they can sell to advertisers and they want to be able to collect detailed data about your online activities. It’s valuable as it can be used to improve their own products and services, and it can potentially be anonymised and sold to interested parties. We can expect every tech company to try and harvest this data. It’s the root of the whole free services deal – if you’re not paying for it; you’re the product.

Who needs who?

There’s some interesting research at NetMarketShare which shows that iOS accounts for almost 60 percent of all mobile and tablet traffic. That means iOS users are more active online than Android users, because there are actually less of them. We also know that iOS users are generally more affluent. It seems obvious that Google would see such an audience as important for its advertising business, which is after all, its main focus. This is about more than the direct mobile search revenue that comes from iOS; consider that Google’s total revenue in 2012 topped $50 billion.

You could certainly argue that Google needs iOS users. Mobile is the growth area online. On the other hand, Apple can’t really offer the best possible experience for its customers without Google’s superior services. If it can’t replace them with better, or at least equal, offerings, then it will turn people off. This may already be happening.

Is Apple really cutting Google out?

Changing defaults definitely has an impact and it makes it very difficult to, for example, use Siri in conjunction with Google Maps. However, the impact can be overstated. When Google released a version of Google Maps for iOS 6 it was downloaded by over 10 million iOS users within 48 hours. Google’s apps remain extremely popular and a lot of people will seek them out and download them, preferring to use them over the defaults.

If Apple really wanted to cut Google out, it would block their apps from the App Store completely. As things stand both companies are making money and it doesn’t look like either would benefit from a complete split. There’s no doubt that consumers wouldn’t.

Water under the bridge?

Just last month Eric Schmidt said of Google and Apple, “These are two proud, well-run, different companies.” He also explained that the two companies are in “constant business discussions on a long list of issues”.

As major competitors they’re unlikely to ever be the best of friends again, but it remains to be seen how far Apple is willing to go in the post-Jobs era.

[Image by aoisora9x]

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About Simon Hill

Simon is an experienced tech writer with a background in games development. He has been covering the world of mobile technology for several years now and writes for a variety of popular websites.