Top Apple executive defends favoring Google on iPhones
Apple’s top deal-maker on Tuesday defended his company’s favoritism of Google on iPhones, a pivotal collaboration that has shaped the modern tech industry and is at the center of a federal antitrust trial against the search giant.
Eddy Cue, Apple’s senior vice president of services, testified in Washington that Google’s placement as the default search option on the Safari browser across Apple devices was motivated by quality.
“I didn’t think at the time, or today, that there was anybody out there who is anywhere near as good as Google at searching,” said Cue, who was called to testify by the Justice Department. “Certainly there wasn’t a valid alternative.”
The Justice Department has accused Google of illegally locking in its monopoly through deals to make its search option the default on Apple, Samsung, Firefox, and other platforms. Those partnerships squashed competitors that struggled to get their products in front of consumers, the Justice Department argues.
The Justice Department and dozens of states that brought the lawsuit argue that Google used the default deals as a “powerful strategic weapon” to block competitors and lock in its dominance in the search market.
No other deal has been as significant to the government’s case as a two-decades-long partnership between Google and Apple. The partnership has been worth $10 billion a year for Apple, which makes up more than 50 percent of the smartphone market in the United States, according to Counterpoint Research, a technology firm.
Cue’s testimony has been highly anticipated. While the case is focused on Google, the Justice Department has viewed Apple as a secondary player and the foremost example of how Google has used its deep pockets to maintain its power over the global search market. Should the judge rule in favor of the government, it could cost Google and Apple billions of dollars.
The trial is the first monopolization case brought by the government in more than two decades, part of a crackdown on Big Tech by regulators appointed by President Biden. On Tuesday, the Federal Trade Commission filed a lawsuit against Amazon, accusing it of illegally protecting a monopoly over swaths of online retail by squeezing merchants and favoring its own services.
The Justice Department is also suing Google for illegally monopolizing the ad tech market. And the FTC is suing Meta for using its dominance in social media to kill off competition.
The US government’s case against Google promised to lift a veil off blockbuster deals between the most powerful global companies, giving the public a rare glimpse into business deals that have determined how consumers access information online.
Apple and Google began their partnership in search in 2002. In 2016, Cue took over renegotiations of the deal. The 30-plus-year Apple veteran had risen to the company’s top deal-maker, overseeing agreements with record labels for Apple Music, banks for Apple Pay, and Hollywood studios for Apple TV+.
In 2016, Cue met with Sundar Pichai, who was then a year into his role as Google’s CEO, to renegotiate for a higher percentage from their revenue-sharing arrangement.
Despite some back and forth on financial terms of a new deal, Cue said negotiations were never tested to the point that the companies would back down from their arrangement.