Why Google pays Apple 36 percent of all advertisement revenues?

In his testimony during a lawsuit filed by Epic Games, Google CEO Sundar Pichai confirmed that Google pays Apple a substantial 36 percent of all its advertisement revenue. The revelation was made in response to questions during the court proceedings. Pichai emphasized the intense competition between Google and Apple and disclosed that Google's total spending on traffic acquisition cost for 2022 amounted to $49 billion.

When questioned about the disparity in payments to other partners, such as Samsung, Pichai acknowledged the possibility but noted that he wasn't certain about the specific terms. The 36 percent figure was initially disclosed by University of Chicago economics professor Kevin Murphy, who was responding to queries from Alphabet Inc.'s lead attorney.

In further questioning, an attorney from Epic Games sought the dollar value of Google's payments to Apple, to which Pichai responded that it exceeded $10 billion. This revelation comes in the context of ongoing legal scrutiny, with the United States Department of Justice previously accusing Google of leveraging its financial resources to maintain dominance in the search market. Notably, Google had reportedly paid Apple $18 billion in 2021, according to the New York Times.

As the case unfolds, these disclosures shed light on the intricate financial relationships between major tech players and the implications for competition in the industry.