WASHINGTON: Google Inc. is paying Apple Inc. a hefty fee to keep its search bar on the iPhone.
Apple received $1 billion from its rival in 2014, according to a transcript of court proceedings from Oracle Corp’s copyright lawsuit against Google. The search engine giant has an agreement with Apple that gives the iPhone maker a percentage of the revenue Google generates through the Apple device, an attorney for Oracle said at a Jan 14 hearing in federal court.
Rumours about how much Google pays Apple to be on the iPhone have circulated for years, but the companies have never publicly disclosed it. Kristin Huguet, a spokeswoman for Apple, and Google spokesman Aaron Stein both declined to comment on the information disclosed in court.
The revenue-sharing agreement reveals the lengths Google must go to keep people using its search tool on mobile devices. It also shows how Apple benefits financially from Google’s advertising-based business model that Chief Executive Officer Tim Cook has criticized as an intrusion of privacy.
Oracle has been fighting Google since 2010 over claims that the search engine company used its Java software without paying for it to develop Android. The showdown has returned to US District Judge William Alsup in San Francisco after a pit stop at the US Supreme Court, where Google lost a bid to derail the case. The damages Oracle now seeks may exceed $1bn since it expanded its claims to cover newer Android versions.
Annette Hurst, the Oracle attorney who disclosed details of the Google-Apple agreement at last week’s court hearing, said a Google witness questioned during pre-trial information said that “at one point in time the revenue share was 34 per cent.” It wasn’t clear from the transcript whether that percentage is the amount of revenue kept by Google or paid to Apple.
An attorney for Google objected to the information being disclosed and attempted to have the judge strike the mention of 34pc from the record.
“That percentage just stated, that should be sealed,” lawyer Robert Van Nest said, according to the transcript. “We are talking hypotheticals here. That’s not a publicly known number.”
The magistrate judge presiding over the hearing later refused Google’s request to block the sensitive information in the transcript from public review. Google then asked Alsup to seal and redact the transcript, saying the disclosure could severely affect its ability to negotiate similar agreements with other companies. Apple joined Google’s request in a separate filing.
“The specific financial terms of Google’s agreement with Apple are highly sensitive to both Google and Apple,” Google said in its Jan 20 filing. “Both Apple and Google have always treated this information as extremely confidential.”
Google to pay $185m in back taxes: Meanwhile, Google is to pay 130 million pounds ($185.4m) in back taxes to Britain following a government inquiry into its tax arrangements, a company spokeswoman said Friday.
It follows a six-year probe by Britain’s HM Revenue and Customs (HMRC) in response to controversy over low taxes paid by multinational corporations which operate in Britain but have headquarters elsewhere.
“We have agreed with HMRC a new approach for our UK taxes and will pay 130m pounds, covering taxes since 2005,” a Google spokeswoman said.
“The way multinational companies are taxed has been debated for many years and the international tax system is changing as a result. This settlement reflects that shift.”
In future, Google will pay taxes in Britain according to revenue from advertisers based in Britain, something that “reflects the size and scope of our UK business”, the spokeswoman said.
Published in Dawn, January 24th, 2016