When it comes to the future of search, Apple has the upper hand – Gene Munster

The Apple-Google Search deal contributes roughly 15% to Apple’s operating income. If that revenue were lost or reduced, Apple has several alternatives, including deeper integration with AI partners like OpenAI, Perplexity, and Anthropic, or even launching its own search product within Safari. Apple analyst Gene Munster’s biggest concern is that “this introduces a new risk factor into the investment case – one that may take time to fully resolve.”
Gene Munster for Deepwater Asset Management:
‎

Eddy Cue’s testimony in the ongoing DOJ antitrust case against Google was highlighted by his comment that, for the first time, Safari search volumes declined in April. That’s a negative signal for Google, given that I estimate it accounts for roughly 95% of Safari search traffic. It also raises concerns for Apple’s search placement deal, as the underlying economics of traditional search appear to be coming under pressure.
Cue added that he believes AI-native search providers will eventually replace traditional engines like Google. Apple is actively exploring the integration of AI-powered search features into Safari and could potentially partner with companies like OpenAI, Perplexity, or Anthropic.
Even in a worst-case scenario, where the Google deal is broken up or loses its economic force, Apple has levers to pull to monetize its massive user base. For example, by either charging users directly or partnering with another AI search provider, Apple could aim to generate just $1 per month per active user. With approximately 1.5B active users (and 2.2B active devices), that alone could yield $18B in annual revenue, nearly enough to fully offset the estimated $20B per year it currently receives from the Google Search placement agreement… [T]he narrative that Apple is overly dependent on Google Search is over stated. Apple could potentially come out ahead if forced to move in a new direction.

‎
MacDailyNews Take: Google’s search monopoly cannot die quickly enough!
As we wrote earlier this month, “We no longer search with Google as its results do not reflect the depth of the entire web, and skewed by bias, and are laden with paid placements. Google is passé. For far, far better search results than Google, we use Grok 3 either in Safari via x.com/i/grok or in the Grok app for iPhone and iPad.”
The writing is finally on the wall for Google search. It’s all downhill from here.
Google is an online advertising monopoly masquerading as a search engine. Effective antitrust action against Google that restores competition into the the online search and advertising markets would be very welcome (while we’re still here, please)!
The unfortunately ubiquitous search engine is a mechanism for tracking users in order to deliver targeted advertising to them. – MacDailyNews, March 17, 2021

We’d like to see real competition in the online search and advertising markets restored someday. — MacDailyNews, March 20, 2019

With this unprecedented power, platforms have the ability to redirect into their pockets the advertising dollars that once went to newspapers and magazines. No one company should have the power to pick and choose which content reaches consumers and which doesn’t. — MacDailyNews, November 9, 2017

Imagine if your livelihood depended on one company that had not only monopolized web search (and, thereby, basically controlled how new customers find you), but also controlled the bulk of online advertising dollars which funded your business and which they could pull, simply threaten to pull, or reduce rates at any time? Now also imagine if you believe this monopolist basically stole the product of another company that is the very subject of your business? How much would you criticize the monopolist thief’s business practices?
You might guess that it would be a tough road to walk. (We’re only imagining, of course!)
That would be a good example of why monopolies are bad for everyone…
In the meantime, stop using Google search and Google products wherever possible. Monopolies are bad for everyone. — MacDailyNews, July 14, 2016

‎
Please help support MacDailyNews — and enjoy subscriber-only articles, comments, chat, and more — by subscribing to our Substack: macdailynews.substack.com. Thank you!
Support MacDailyNews at no extra cost to you by using this link to shop at Amazon.
The post When it comes to the future of search, Apple has the upper hand – Gene Munster appeared first on MacDailyNews.