In the year 2021, Google disbursed a staggering sum of $26.3 billion to secure its position as the primary search engine on mobile devices and web browsers.
This big sum of money shows how much Google pays its partners, especially Apple, to stay as the main search engine on their devices. The U.S. Department of Justice, along with a group of state attorneys general, says that Google has unfairly kept a strong hold on the general search market by using its power to block other search engines, especially on Apple’s Safari web browser. Let’s make it clear that this $26.3 billion isn’t just for one company, it’s spread among many, and Apple is probably getting the biggest piece of the pie.
Google’s Big Spending on Distributors: DOJ’s Complaint Reveals the Details
The Department of Justice’s complaint says that Google gives a lot of money each year to companies that help distribute its products. These companies include big brand names like Apple, LG, Motorola, Samsung, and major U.S. wireless carriers like AT&T, T-Mobile, and Verizon. They also include companies that create web browsers like Mozilla, Opera, and UCWeb. Google pays them to make sure that Google’s search engine is the one that comes up when you search by default. Sometimes, they also pay these companies not to work with Google’s competitors.
During a court presentation on a Friday, there was a slide titled “Google Search+ Margins“. This slide gave us a good look at how Google’s search business is done in 2021. It showed that Google made more than $146 billion in revenue. Also, it had to spend more than $26 billion on getting web traffic.
The slide didn’t just show the current year, it also had numbers from 2014. Back in 2014, Google made about $47 billion, and they spent around $7.1 billion to keep their search engine in top position. This means that between 2014 and 2021, the revenue from the Search+ division grew three times, and the costs of getting traffic increased nearly four times.
When Google talks about its TAC figures, they’re referring to the money they pay to partners who display ads on their platforms. You can find this info in their official 10-K filing with the U.S. Securities and Exchange Commission.
