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U.K.: Google and Apple’s billion-dollar search engine deal stifles competition

Google and Apple’s billion-dollar search engine deal is under fire in the United Kingdom. The country’s competition watchdog is investigating the exuberant sum Google pays Apple every year to be the default search engine on Safari — which the regulators say creates “a significant barrier to entry and expansion” for rivals.

According to an updated study on online platforms and digital advertising filed by the U.K. government’s Competition and Markets Authority (via Reuters), Google shelled out 1.2 billion British pounds (about $1.5 billion) last year to be the go-to search engine on browsers across a range of devices in the U.K., the “substantial majority” of which went to Apple.

The rest of the search engine operators such as DuckDuckGo and Microsoft’s Bing pay Apple a fee themselves to stay as an alternative that users can manually switch to from the browser settings. But lacking the resources Google has makes it “more difficult for these providers to grow their user bases and improve their search quality and search monetization rates.”

“Rival search engines to Google that we spoke to highlighted these default payments as one of the most significant factors inhibiting competition in the search market. Consumers primarily access the internet through mobile devices, which account for over two-thirds of general searches, a share which has grown substantially in recent years and is likely to continue to grow in the future,” the regulators added in the report.

Apple switched from Microsoft’s Bing to Google as the default search engine across Safari and Siri three years ago for a reported yearly sum of $1 billion.

The report goes on to suggest that to address these concerns, Apple should consider offering users an option to pick a search engine when they launch the browser the first time instead of configuring Google by default on Safari. Another route could be to limit Apple’s ability to monetize default search engine positions. That may end up knocking off a hefty chunk of yearly revenue from Apple, however.

“We support regulation that benefits people, businesses and society and we’ll continue to work constructively with regulatory authorities and Government on these important areas so that everyone can make the most of the web,” Ronan Harris, Google’s vice president for the U.K. and Ireland, said in a statement sent to Digital Trends.

Google added it has been working with the Competition and Markets Authority for the past year, addressing questions, providing documents, and collaborating with the watchdog’s team of economists.

U.K.’s antitrust watchdog forced a similar change on Google a couple of years back. Starting in 2019, Google began offering the country’s Android users an option to pick the search engine instead of pushing its own by default.

We’ve reached out to Apple for a comment and we’ll update the story when we hear back.

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