Apple Core of Google Mobile Ad Biz Revenue, But Seeds of Trouble Appear

Apple Core of Google Mobile Ad Biz Revenue, But Seeds of Trouble AppearWhile it’s true that Apple and Google are often competitors, the companies also have working relationships that pay dividends for both.

These “frenemies,” for instance, enjoy a mobile ad alliance that appears to be working quite well, according to a recent and altogether fascinating AppleInsider post.

“Despite the ever-increasing competition between Google and Apple, iOS remains an exceptionally important advertising platform for the search giant, with one Wall Street estimate attributing as much as three-quarters of Google’s mobile ad revenue to users of Apple’s devices,” according to the story. “Of the $11.8 billion in mobile search revenue Google booked in 2014, 75 percent — nearly $9 billion — came from iOS.”

Cited are a recent Goldman Sachs analysis, as well as the firms’ arrangement that makes Google default search engine for mobile Safari.

“That arrangement is thought to cost Google between $1 billion and $2 billion each year, and many believe that it will end sooner than later,” the report concludes. “Apple is rumored to be considering a switch to Yahoo or Bing, and might also enter the market with its own solution.”

Is Google’s hegemony in jeopardy?

It’s definitely a tenuous situation, say analysts, that would grow worse should Google lose iOS. Mobile search is overtaking the once powerful desktop environment. Worse yet, for Google, is that a host of Android suppliers are saying no to Google and choosing other options.

“This is especially true in mainland China, where most Google offerings are blocked by government firewalls,” says AppleInsider. “Without Apple, Google risks being ironically cut out of the market by its own software.”