Google says it pays Android brands and Apple (?) to fight iOS

Google has long come under fire for its revenue-sharing agreements with smartphone brands, with charges that these deals limit competition from rival services. Now, a Google employee has argued that these agreements are actually meant to help Android phones fight iOS.

Google employee Jamie Rosenberg testified in the company’s defense during its antitrust trial, Bloomberg reported. Rosenberg asserted that Google’s revenue-sharing agreements with smartphone brands and carrier partners provide resources to help Android OEMs fight Apple’s iPhones.

Google’s defense of search deals

The company’s deals see it sharing search engine revenue with smartphone makers and carriers, and the employee claims these payouts help partners promote and maintain Android products (e.g. security updates). 

Rosenberg said Google has since changed its approach with US mobile networks. It still offers a revenue-sharing deal but now also offers cash to companies to motivate them to sell more Android handsets.

Google also split its revenue-sharing agreement with Samsung into three separate deals in 2020, Rosenberg testified, focused on search, services, and marketing. He confirmed the latter agreement was contingent on Google being the exclusive search provider, though.

“All of these are about making the devices more competitive with iOS,” the Google employee argued.

Does paying Apple form part of this defense?

We can understand if Google pays carriers to sell more Android phones. After all, it’s not unheard of for Android OEMs to pay carrier/retailer employees for selling their phones. But Google’s revenue-sharing deals for search seem at odds with this defense.

The Justice Department argues in its antitrust trial that Google pays Apple and Android OEMs to be the default search engine, therefore stymying competition from rival search engines.

It’s particularly noteworthy that Google also pays Apple as part of these revenue-sharing deals. Surely Google isn’t paying the iPhone maker to make Android devices “more competitive with iOS”? After all, giving billions to Apple for an iOS deal would more likely help Apple rather than Android OEMs.

Rosenberg also confirmed that it doesn’t have revenue-sharing deals for search in Europe following an EU ruling against the company. This doesn’t seem to have adversely affected Android’s fortunes in the bloc, as Samsung beat Apple to the top spot in Q2 2023, with Apple only accounting for 23% of shipments versus Samsung’s 33% share.