Microsoft reportedly tried to sell Bing to Apple in 2018, but failed.
The sale fell through because Apple had concerns about Bing’s search quality, advertising unit and monetization capabilities, according to a document in Google’s antitrust case against the US Department of Justice.
Google argues that the failed sale highlights that Bing lost because it is an inferior search engine, not because Google made the search market unfair to its competitors, because CNN.
Apple rejects Microsoft. Microsoft reportedly proposed selling Bing to Apple or creating a Bing joint venture together. Eddy Cue, Apple’s senior vice president of services, explained why Apple said no to Microsoft at the presentation:
“The quality of Microsoft’s search, its investment in search, everything was not significant at all. And so everything was lower. So the quality of the search itself was not that good. “They weren’t investing at any level comparable to Google or what Microsoft might invest in. And their advertising organization and the way they get money was not very good either.”
What Google says. Google claims that Microsoft’s failed attempt to sell Bing to Apple proves that Bing is an inferior search engine. Google wrote in the presentation:
“In each case, Apple looked at the relative quality of Bing versus Google and concluded that Google was the superior default choice for its Safari users. That’s competition.”
Google also argues that Microsoft approached Apple several times (in 2009, 2013, 2015, 2016, 2018 and 2020) with proposals to make Bing the default search engine in Apple’s Safari web browser. However, Apple consistently rejected the idea, citing concerns about the quality of Bing’s performance.
What Microsoft says. Microsoft denies that its attempts to sell Bing to Apple are due to quality problems; instead, the tech giant claims the sale was blocked by Google. Microsoft’s CEO of Advertising and Web Services, Mikhail Parakhin, said he offered Apple more than 100% of revenue or gross profit to make Bing its default search engine, but the proposal was rejected due to Apple’s deal with Google.
Speaking at the federal antitrust trial, Parakhin alleged that this was despite Microsoft offering to pay Apple more than Google, which he said was offering about 60%. He said:
“We were big enough to play, but probably not big enough to win, if that makes sense.”
What the DOJ says. Google has a financial deal with Apple to be the default search engine for its products at a cost of about $10 billion a year. In addition, Google pays Apple’s advertising revenue, which is one of the search engine’s biggest costs. The Justice Department said in its filing that Apple boss Cue stated:
“If Apple did not receive the massive payments it sought from Google, Apple would have developed its own search engine,” the Justice Department said in its filing.
Google could pay Apple up to $19 billion this fiscal year, according to an estimate by Bernstein analyst Toni Sacconaghi. The DOJ claims that these substantial sums of money are the reason Apple rejected a potential joint venture with Microsoft, not because Bing is inferior to Google.
Why we care. The US Department of Justice is suing Google, alleging that it uses unfair tactics to maintain its position as the world’s top search engine. If Google can prove the superiority of its search engine, it could succeed in this case. However, if it loses, Google could lose its automatic status as the default search engine in common Apple products, posing a potential threat to its dominance in the search market.
Market share statistics. The US Department of Justice claims that Google has a 90% market share in search. On the other hand, Bing has 3% of the global market share, according to StatCounter.
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