Google and Samsung could lose their biggest client next month

Google and Samsung could lose their biggest client next month

Summary: Google could lose half (or more) of its ad revenue and Samsung could lose its biggest client if Apple decides to cut them out of its products at its Worldwide Developers Conference.

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Google and Samsung could lose their biggest client next month - Jason O'Grady
(Image: Jason D O'Grady/ZDNet)

The war between Apple and rivals Google and Samsung could heat up next month as the Cupertino-based giant is rumored to announce some big changes at its its Worldwide Developers Conference (WWDC), including cutting off both Google and Samsung. 

Apple's WWDC kicks off on 10 June in San Francisco, California, and while the company never announces its plans in advance, there are rumblings that it could wield its almighty ban hammer against Google and Samsung. 

Samsung on the outs

In September, Apple cut the amount of chips that it ordered from Samsung for the iPhone 5. A report said that while Samsung is still an approved supplier, Apple instead picked Japan's Toshiba Corp, Elpida Memory and Korea's SK Hynix to supply DRAM and NAND chips for the iPhone 5. 

In August 2012, Apple won a landmark victory against Samsung after a US jury found that it had copied key features of the iPhone, and awarded Apple $1.05 billion in damages. More recently, it's been whispered that Apple is going to drop Samsung silicon from the upcoming iPhone and iPad in favor of TSMC, a move that could have devastating repercussions for Samsung.

Google on the outs

Bloomberg reported in April that Apple's Eddy Cue met with Yahoo CEO Marissa Mayer to discuss "ways Yahoo can be more deeply integrated into the software that runs on the iPhone and iPad". The most obvious way to do this would be to replace Google with Yahoo as the default search provider on Mobile Safari in iOS 7. Apple could also replace Google with Yahoo in the desktop version of Safari in OS X 10.9, also rumored to be previewed to developers next month. Mayer was quoted in January as saying that she wants Yahoo to work with Facebook, Google, and Apple to widen the reach of the biggest US web portal.

Vendetta or good business?

There's clearly no love lost between Apple and Google. A case could be made that theft of Apple intellectual property occurred while Eric Schmidt was on the Apple Board (a charge Schmidt denies). Schmidt was on the Apple Board during the development of the iPhone, and Google's first Android phone appeared on the market suspiciously soon after its announcement. In July 2009, I called for Schmidt's dismissal, and he was gone from the Apple Board less than a month later. 

Then shortly before his death, Jobs gave this wonderful pearl to biographer Walter Isaacson:

… I will spend every penny of Apple's $40 billion in the bank to right this wrong. I'm going to destroy Android, because it's a stolen product. I'm willing to go thermonuclear war on this. 

Apple's been slowly moving away from Google over the past year, as evidenced by its removable of both Google Maps and YouTube from iOS.

Apple is their biggest client

Apple became Samsung's biggest client in February 2011 when the Wall Street Journal reported that it purchased $8 billion worth of LCD displays, NAND flash memory, and mobile chipsets from the Korean manufacturer. Samsung manufactures the "Apple" A5 and A6 chips used in all iPhones and iPads.

With iOS retaining over 65 percent of mobile marketshare, a switch away from Google as Apple's default search provider would definitely make a major dent in the company's advertising revenue. While iOS users could still browse to www.google.com (or use the Google Search app) for searching, most iPhone and iPad users use the search bar built into Mobile Safari. If Apple switches to Yahoo, the biggest winner would be Microsoft, because Bing powers Yahoo search (even though Yahoo wants out of the deal). 

Put yourself in Tim Cook's shoes. Would you dump Google and Samsung?

Topics: Apple, Android, Google, iPhone, iPad, Samsung

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144 comments
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  • This will be a lose lose situation for both apple and google

    With yahoo's inferior products it will be two steps backward for apple and without apple, google loses a lot of revenue...but i don't deny it that would be interesting to see if this really happens!
    L3thargic
    • Most users will not even notice

      There would be a very small minority of very vocal users complaining should this happen, but most users would not even notice.
      James Kent-JK
      • Most users will not even notice

        I agree. Only the Apple haters and detractors will make noise. Bing's a whole better than Google search now.
        pjtmgt
        • re: Most users will not even notice

          "Bing's a whole better than Google search now."

          Thanks for the laughs ... funniest thing I've read all day.
          perrrob
          • Apple is starting to lose grip on reality

            If they go with Yahoo, they will be paying a middle man to reach Google. That' s obvious, so it does not make business sense.

            Bing, is laughable, the same as the post above. That would just give window phones a real chance to gain ground. Stupid move. Apple would be in the same position as it is now with Google, except that they would follow what MS does best, (example: look at Nokia!). That' s a silly move.

            If Apple breaks up with Google for search, it may go the way Apple Maps went, in house!. We know how that story ended. But still the most likely. As they may have learned a lesson or two. Though foolish in the end, as it takes too much time, resources, money and talent to do what Google does. And Apple IOS is now lagging 2-3 years compared to Android OS. So that's spreading resources thin, not a good move again.

            Apple's best move is to pal up with Google. Fat chance at that. So a status quo seems more likely.

            Samsung, is wining Apple worldwide, Apple has the US. So in the end a wash. Long term Apple is set for extinction if it does not compromise.
            Uralbas
          • search engine only improves

            Once Apple rules out google and starts using yahoo, both yahoo and bing gets user data and they get even better with it.
            Mac_Win
        • Objection^

          Every time I search w/ bing, it displays results then randomly everytime takes me to a site I never visit, google search never did that!
          Raleigh Brecht
        • Too. Funny.

          "Bing's a whole better than Google search now."

          That is hilarious.
          dunamis100
          • yeah that is a good one

            the audience roars with laughter.

            Google rules the planet
            Sherwin_Maxawow
        • I use Google to find what I want in M$s own websites.

          The built in search on every M$ webpage never gives me a usable result. Google finds what I was looking for in the top 3 hits.
          mlashinsky
      • Are you forgetting AT&T?

        As ATT utilizes Yahoo for its mail (I suspect there are other ISP's doing the same), there is a much larger audience than you indicate. The advertising that is bannered, seen by a large portion of emailers, will probably be enough to shore up Yahoo for some time.
        David Nesbitt
    • the results would be okay

      Yahoo is not complete garbage. It does the job.
      Throw All The Things
      • Of course...

        It's powered by Bing... :-)
        brhorv
        • And Bing

          is mostly garbage.
          Knowles2
          • Don't use Yahoo

            But Bing is fantastic, so much less garbage than Google
            Xenon8
          • both are same

            both are same in back end.
            Mac_Win
          • Bing....

            ...is slowly becoming my search engine of choice. I find myself endlessly searching page after page of google ads before I finally find the info I need. And then I try the same search in bing and the webpage I was looking for comes up in the 1st or 2nd page!? Especially technical papers and "how-to" info, as well as blogs with info from other users that have had similar problems (and hopefully solutions) are usually just a couple of minutes away in Bing, while on the google side it tends to take me much longer to find.

            Hate to sound like the "bing it on" commercial - but I do have to say that at this time, Microsoft has a better search engine than google.
            rock06r
          • Google Ads?

            Since I've switched to Firefox and used the AdBlock Plus add-on, I haven't seen a Google ad. Now in IE, that's another matter entirely. But in Firefox - ad free.

            And Bing? For me it's useless. I find what I'm looking for on the first page of a Google search. On Bing using the same search criteria the same link that Google has on the first page is usually several pages down.
            benched42
          • Stop giving away our secrets!

            Quit telling folks how wonderful our non-ad utopia is. If everyone joins us then content providers will find another way to chisel money out of us and make our experience miserable. Leaving it as is means we get to enjoy the experience while the sheep quietly go to slaughter.
            ejhonda