In 2017, the chief executives of Google and Apple, Sundar Pichai and Tim Cook were captured having dinner at a Vietnamese restaurant. This created chaos among the Tech world as two leading Tech lords were seen sipping red wine together. During those times, both of the companies were in the middle of tense negotiations to renew one of the most profitable deals in the history of the business world. This deal was worth billions of dollars which were invested by both parties.
Why is this deal in danger?
Last Tuesday, the department of justice of the U.S filed lawsuits against Google. This is said to be the USA’s biggest antitrust cases from the previous two decades. The prosecutors say that the company has used illegal tactics to minimize the competition in web searches through all these years.
Hence the partnership between Google and Apple is in hot water.
Apple and Google are referred to as two buddies even though the chief executive of Apple has said that internet advertising which is the bread and butter of Google engages in “surveillance” of consumers. However Steve Jobs, Apple’s co-founder, once promised “thermonuclear war” on his Silicon Valley neighbor when he learned that Google was working on a rival to the iPhone.
Both of these companies have the same parent company, Alphabet inc. The parent company usually deals in such a way that will provide benefit to both, Apple and Google.
According to the Justice Department, nearly half of Google’s traffic comes from the products of Apple. However, if this deal breaks, Google will suffer a major loss in its revenue.
A former executive of Google called this situation terrifying for the company as losing Apple’s traffic will give a direct hit to Google.
This breakup will also affect Apple as the company will lose its easy money deal but certainly, it will be worse for Google. This deal is not limited to few products but it extends to all the searches done on Apple’s devices.
We are waiting for these cases to be progressed so we can see whether this deal will break or both of these partners will come to another agreement for mutual benefits.