According to a recent report from the UK Competition and Markets Authority, Google paid £ 1.2bn (or around $ 1.5bn) in 2019 to secure its place as the default search engine on devices across the market, whose “substantial majority of which” was paid to Apple That’s a huge Sum, and rival search engines say it makes competition impossible: they simply cannot afford to contend with such high numbers.
The full report is a monumental length of 437 pages, encompassing a wealth of detail, and while it touches on other tech giants like Facebook, most of the report points to Google. He points to many issues, such as ecosystem lockdown and possible abuse of user data, but he also makes some more specific claims about the anti-competitive nature of Google’s flagship search product, arguing that “Google’s wide default positions on devices and browsers, and in particular on almost all mobile devices in the UK, act as a barrier to the expansion of other search engines. ” Furthermore, the Authority explicitly believes that agreements such as the one it has with Apple are against the interests of consumers: “Apple’s existing agreements with Google create a significant barrier to entry and expansion for rivals that affect competition between mobile search engines. “
An excerpt from the report.
The report recommends that these kinds of fixes for the default settings be restricted by a new agency from the Digital Markets Unit, and that the setup screens that provide customers with a search engine option, as Google has done in Europe, they would further enhance competition.
Google’s agreement with Apple dates back more than a decade, making it the default search engine in Safari on Apple iPhones. Although the precise figures remain confidential, estimates and leaked figures indicate that the sums have skyrocketed over the years, from $ 82 million in 2009 to $ 12 billion last year. While the UK agency cannot judge in other markets, the number types disclosed in this report eliminate any real possibility of competition. Even if customers can change their preferred search engine later, most don’t, and Google is still the favorite dog with the money to spare to maintain that position.
Admittedly, I must assume that regulators did not actually try to use any of the competing services or compare its quality with Google: it is very likely that the search is a monopoly, but it is also an unmatched product, and other options do not compete with the characteristics or the quality of the results. I couldn’t imagine doing me work without it. Still, these kinds of antitrust concerns are too valid. While the report doesn’t seem to recommend actions like a fine (yet), we might see a similar search engine setup screen on iPhones and Android devices in the UK, as they did for Android phones in the EU.
In the meantime, reflect on the fact that Google not only spent nearly $ 1.5 billion to be the default search engine on a bunch of devices in the UK; doing it was almost certain profitable decision.
