Biggest threat for Google ... Apple. Opinion on the two frenemies

Disclaimer, I have a postion in Google and do not hold Apple directly (but I do trough BerkshireB/S&P), so my opinion may be biased.

While I think the underlying business of Google is incredibly good, I have the feeling that it moat is getting smaller. I expect growth from its cloud services, YouTube, and maybe some of Google bets might play out (Pixel phones, robotaxies, chromebooks if they stop sucking...) , but we all know that the most profitable part of Google business is its search engine.

Know, while Microsoft might try to eat Googles pie and is probably its main competitor over most segments, especially Bing/Chatgpt vs Chrome/Bard, Outlook vs Gmail, M.Teams vs G.meet and so on, I think the biggest treat is actually Apple.

Right know Google is paying a big undisclosed amount (probably around 20 bln $ a year ) to be the default search engine on Apple devices, where a lot of Google searches (from the most valuable well off users) come from. The idea that Apple could raise the price of the deal by a lot or start promoting its own search engine is quite terrifing. It would be a risky move for them (losing 10s of blns a year for doing effectively nothing, and coming up with a search engine on their own that gives satisfactory results) but given Apples pivot toward services and its insane customer loyalty it might not be that crazy after all.

Android has a biggest market share, but these people have a lower capacity/willingness to spend, so it doesn't really matters that much. If I had to rate Google search traffic, I would say that the one coming from Android users is the safest (and probably the least profitable), the one coming from Windows PC is still relatively safe (despite bing being default and intagrated with Chatgpt), and the one coming from iOS is the one most at risk, and unfortunately for Google the most profitable.

This article summarizes some of my concerns quite well.

An article I just read put it quite well IMO
https://macdailynews.com/2023/02/21/google-pays-apple-20-billion-annually-to-be-safaris-default-search-engine/#:~:text=Google%2Dparent%20Alphabet%20pays%20Apple,writes%20for%20The%20Motley%20Fool.

Let me know what you think.

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