Michelle ThompsonApple is reportedly exploring ways to revamp the Safari browser on its devices to prioritize AI-driven search engines, potentially challenging Google’s dominance in the search market. Eddy Cue, an Apple executive, testified in the U.S. Justice Department’s antitrust case against Alphabet, noting that Safari searches declined last month, attributing the shift to users increasingly relying on AI.
Currently, Google is the default search engine on Safari, paying Apple an estimated $20 billion annually, which represents around 36% of Google’s search ad revenue from Safari. Losing this position could place significant pressure on Google, especially as AI startups like OpenAI and Perplexity gain ground. Apple has already partnered with OpenAI to offer ChatGPT as a Siri option, while Google is working to finalize an agreement to integrate its Gemini AI technology into Apple’s new devices.
Alphabet’s shares dropped 6%, and Apple’s fell about 2%, with neither company nor the Department of Justice commenting on the matter. Cue expressed his belief that AI-powered search providers, including OpenAI and Perplexity, may eventually replace traditional search engines like Google. He indicated that Apple plans to include these AI options in Safari, although they may not become the default.
Despite this potential disruption, Google reassured investors about the strength of its AI-driven advertising business after exceeding expectations in the first quarter. Analyst Gil Luria suggested that losing exclusivity with Apple would have significant repercussions for Google, noting that many advertisers currently rely on Google, which holds nearly 90% of the search market share. If alternative search options gain traction, advertisers may shift their budgets away from Google.
Emily Martinez
