In a federal antitrust trial against Google, it was revealed that the company paid $26.3 billion to be the default search engine on mobile phones and web browsers in 2021. This payment represents the amount Google pays its partners, including Apple, to have their search engine as the default option on their products.

The U.S. Department of Justice and a coalition of state attorneys general have argued that Google has illegally maintained its monopoly power in general search by leveraging its dominance to block rivals from key distribution channels, such as Apple’s Safari web browser.

While the $26.3 billion figure is not specific to any one company, Apple is likely the largest recipient of these payments. Industry analysts estimate that Google could pay Apple as much as $19 billion this year for the default placement on Apple devices.

The DOJ complaint states, “Google pays billions of dollars each year to distributors, including device manufacturers, wireless carriers, and browser developers, to secure default status for its search engine and to prohibit dealing with its competitors.”

Google argues that users have the option to change their default search engine with a few clicks.

Google Search+ Margins

According to a slide shown in court titled “Google Search+ Margins,” Google’s search business revenue for 2021 exceeded $146 billion, while the portion dedicated to traffic acquisition costs (TAC) was over $26 billion.

The slide also included data from 2014, when Google’s revenue for the search division was around $47 billion, with $7.1 billion paid for default status. This means that revenue for Search+ has tripled between 2014 and 2021, while TAC costs have nearly quadrupled.

It is important to note that Google’s reported overall TAC figure includes payments to network partners for ads shown on their properties. The slide discussed in court specifically refers to the portion of TAC related to Search+ revenue.

Google’s distribution partners, including browser providers, mobile carriers, original equipment manufacturers, and software developers, receive payments for making Google’s access points and services available. This represents the portion of TAC discussed in the slide.

A Google spokesperson declined to comment, and an Apple spokesperson has not responded to AsumeTech’s request for comment on the matter.

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