Why Google Paid Apple $1 Billion and Oracle is Not happy About It


By Robert Stitt

It’s a battle that has raged on for over half a decade. Oracle, a business software giant, is the creator of Java. According to Oracle, the software is copyrighted and, if used without its consent in the development of other systems, is subject to copyright infringement laws. Google says that there are many variants of Java and the one they used falls under a software category known as Application Programming Interface (API) which is open for anyone to use and not subject to copyright laws.

In 2008, Google used the Java software during its creation of the Android operating system. According to Oracle, Android has made over $31 billion, netting Google over $22 billion. Oracle wants a piece of that pie.

The first time the courts made a ruling, it went in Google’s favor. Oracle appealed. The Appeals Court ruled in favor of Oracle. The case is now going back to court for yet another round of debate.

According to Bloomberg Business, during the court proceedings, it came out that Google “paid Apple $1 billion dollars to keep the Google search bar on the iPhone.” While many people feel this is not a big deal because Google is the best search engine out there, others believe it is shady business. This is Oracle’s point.

If you go back a few iOS generations, you will find that Apple and Google were quite friendly with many Google apps even coming standard on the iPhone. When Google went full-on with Android, however, Steve Jobs allegedly became irate and vowed to wipe Google off of all the iPhones. That’s when the billion dollars came into play. Jobs was mad, but not a billion dollars mad. He still scrubbed most of Google’s presence off of the phones, but Google is still the default search engine on all Apple devices. Apparently, Google also has to pay a percentage of all advertising revenue it receives from the phones.

Google says that while the Android system is used in phones and tablets, the vast majority of its revenue is made through ad revenue and cuts of Google play apps. To keep it all in perspective, according to the Appleinsider, “Apple’s iPhone revenues from the September quarter alone (about $32.2 billion) surpassed what Android has made over its entire lifespan.”