Alphabet pays a "huge sum of money" to Samsung every month to pre-install Gemini in the Korean manufacturer's smartphones. The admission was made by Peter Fitzgerald, Google's vice president of Platforms and Partnerships, during his testimony during the antitrust proceedings between the US Department of Justice (DoJ) and the web giant.
The checkbook policy
Last summer, the courts established that Google had indeed abused of its monopoly on online search, showering manufacturers, Apple in the lead, with billions of dollars to be the default search engine on their devices and web browsers. It's a safe bet that Google will be forced to stop these payments.
For the recipients of the check, it's a catastrophe: Google's check — more than $20 billion a year! — represents a huge windfall in Apple's "services" business. The firm Apple had also asked, in vain, to participate in the trial currently taking place to determine the remedies to be applied and avoid this abuse of position.
This sword of Damocles has not prevented Google from repeating the same strategy, this time for its AI assistant. Since January, the company has been paying a certain sum (the amount has not been revealed) to Samsung so that Gemini is present in Galaxy smartphones. The contract, which combines fixed payment and revenue sharing, runs for two years, revealed Peter Fitzgerald.
Between 2020 and 2023, Samsung received $8 billion to make Google the default search service, app store, and assistant (Google Assistant). This revelation is unlikely to help the company in the face of DoJ charges that it is locking out competition by making it nearly impossible for credible alternatives to emerge or survive on Android devices.
Source: Bloomberg
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