Will Apple Inc. (AAPL) Renew Google Inc (GOOGL)’s Default Search Engine Contract?

Internet connects us all: sometimes in ways that we would not like to. Google Inc (NASDAQ:GOOGL) and Apple Inc. (NASDAQ:AAPL) deal that makes Google Search the default search engine on Apple Inc.’s (NASDAQ:AAPL) devices is up for renewal. There is a growing concern that Apple Inc. (NASDAQ:AAPL) might not renew its search engine deal with Google Inc (NASDAQ:GOOGL). In form of this deal with Apple Inc. (NASDAQ:AAPL), Google Inc (NASDAQ:GOOGL) has billions of dollars on stake. PCMag’s Editor-in-Chief, Dan Costa was on CNBC’s Tech Bet, to talk about the impact if Google Inc (NASDAQ:GOOGL) would no longer be the default search engine on devices of Apple Inc. (NASDAQ:AAPL).

Apple, AAPL, Google, GOOGL

“The defaults are extraordinarily powerful in this space. If you look at the Safari market, that includes much more than just the desktops. Apple’s Safari owns about 10% of the desktop market. On tablet they own 70% of the market but the key here is mobile where 50% of the mobile searches are run through the Safari browser. That’s what Google would be losing. If you look at how much money it is contributing to their gross revenues it could be about 10% of their overall advertising spend. So this definitely is a deal that Google wants to hold onto,” Costa said.

Costa believes Microsoft Corporation (NASDAQ:MSFT)’s Bing and Yahoo! Inc. (NASDAQ:YHOO) have both made a lot of progress in adding functionality to their search engines. Moreover, search results are not as distinguished and rare as they used to be.

Google Inc (NASDAQ:GOOGL) has already lost its status as default search engine on Mozilla’s Firefox at the end of 2014. Mozilla Foundation has signed on Yahoo! Inc. (NASDAQ:YHOO) to make it the default search engine on Firefox for US users.

Search volume is life of search engines because that is how they create opportunities for showing ads to make money. Some of those ads can be shown in certain searches only. Apple Inc. (NASDAQ:AAPL) deal is definitely a sweet deal for Google Inc (NASDAQ:GOOGL). Without Apple Inc. (NASDAQ:AAPL), Google Inc (NASDAQ:GOOGL) might not be able to drive a lot of profit from the mobile industry. Since 50% of all mobile consumers are also users of Apple Inc. (NASDAQ:AAPL), Google Inc (NASDAQ:GOOGL) has a lot to worry about as some consumer might want to stick to different search engine experience. Google Inc (NASDAQ:GOOGL) is a search engine at its core and they might feel they have been kicked in the gut if Apple Inc. (NASDAQ:AAPL) decides to make its deal with Microsoft Corporation (NASDAQ:MSFT) or Yahoo! Inc. (NASDAQ:YHOO).

Apple Inc. (NASDAQ:AAPL)’s search volume makes up an estimated 10% of Google Inc (NASDAQ:GOOGL)’s gross revenue. Out of Microsoft Corporation (NASDAQ:MSFT) and Yahoo! Inc. (NASDAQ:YHOO) whoever can pick up this deal from Apple Inc. (NASDAQ:AAPL) can be sure to see deep positive impacts on their business. These are not small potatoes.

“This is a huge part of the mobile market in the US. It’s also a premium consumer. You know, these are the people that buy Apps, they spend money, That is not an audience that Google is going to want to lose. And another thing is that I think Apple has got a great position here to leverage their deal. They are going to go to Yahoo, they are going to go to Microsoft Bing – and they are going to ask for better terms,” Costa said.

Apple Inc. (NASDAQ:AAPL) introduced Duck Duck Go search engine on its devices as a secondary choice last year so we can guess Apple Inc. (NASDAQ:AAPL) might stick to Duck Duck Go – this time as its default search engine – or it might draw up a contract with either Microsoft Corporation (NASDAQ:MSFT) or Yahoo! Inc. (NASDAQ:YHOO). While things are going wrong for Google Inc (NASDAQ:GOOGL) one thing that remains undeniable is popularity of Google Inc (NASDAQ:GOOGL) as a search engine. Let’s just say people don’t search – “they Google”. Apple Inc. (NASDAQ:AAPL) would definitely have a thinking cap on right now. Consumers would not appreciate any little visitor on their devices which they find meddling with their habits. This one cuts both ways!

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