Satya Nadella, CEO of Microsoft, testified a few hours ago in the antitrust trial to which Google is being subjected. The process is revealing important details about the search segment, and the participation of the head of the Redmond company made it clear how difficult – if not impossible – it is to compete with Google’s search engine.
Nadella would give (almost) everything to put Bing on iPhones . Justice Department attorney Adam Severt asked Nadella what it would mean if Apple used Bing instead of Google as its default search engine. “It would change the rules of the game,” he explained. Microsoft’s CEO was willing to pay whatever Apple asked, lose up to $15 billion in the process, hide the Bing brand in Apple’s interface, and respect privacy requirements. Or what is the same: I would give practically anything to be able to be with Bing where Google is. The reason?
The default options are the only ones that matter . For Nadella, being the default search engine would change everything because “the default options are the only thing that matters.” It is a palpable reality in a market in which effectively whoever is the native option wins. Startups that try to compete with Google know this well: DuckDuckGo maintains its momentum, but promising projects like Neeva ended up being abandoned due to the difficulty of competing.
The Apple Maps example . Judge Amit Mehta again stressed the issue that people can change search engines. “My only argument against it is that users don’t change.” The example for him was clear: Apple’s Maps application, which had disastrous beginnings on iOS, has been gaining market share in the last decade for a reason: it is preinstalled on all iPhones. “People use it, it’s the default,” Nadella said.
Google protests . John Schmidtlein, a lawyer for Google, indicated how Microsoft does the same with Edge and Bing and how it always tries to make them the default option. And despite this, he says, people end up switching to Chrome and its browser, which shows that their products are simply better. However, for Nadella that is a contradiction: the fact that Bing has some share in Windows – as difficult as that is when competing with Google – shows that the default options work. Thanks to that, more people used Bing, which helped Bing improve, which made fewer people make the jump to Google (or another) search engine.
But in reality Microsoft has always done the same thing . Microsoft’s protests may be valid as criticism of Google’s way of acting, but it is somewhat ironic that Nadella is protesting default options when his company has been placing its default options throughout its Windows operating systems for decades. He did it with Internet Explorer — something that ended up costing him great displeasure — and more recently he has done it with the Edge browser or with its video conferencing application, Teams, something that has also brought a lot of trouble .
Microsoft wants the vicious circle that Google has . Becoming the default search engine would allow them to make money, without a doubt, but for him the important thing would be that it would make them much more “competitive.” That presence would allow them to drive what he called a “flow of petitions.” The more people there are, the more searches there are, the more data that is collected to improve the search engine and the more reasons for advertisers to come to the platform. And so on in an infinite vicious circle that right now Google completely controls.
It’s a lie, we can’t choose . In fact, for him the idea that there is true choice in the search engine market is “false.” The head of Microosft described the alliance between Apple and Google as a “fantastic and simple oligopolistic agreement.”
Beyond money . According to The Verge , for Nadella the alliance with Google is not only economically beneficial for Apple; What’s more, Apple could be afraid of what Google would do if it loses that status as the default option. These possible counterattacks are, according to Nadella, another reason why Apple maintains the agreement with the company led by Sundar Pichai.
The future of search with AI . Although Microsoft has bet big on OpenAI and generative AI – there we have Bing Chat -, Nadella believes that content providers and platforms could sign exclusive agreements that would allow Google – with its own chatbot, Bard – to use their data to train their models, which would further reinforce Google’s privileged position. “The vicious cycle I’m trapped in could be even more vicious because the default options are self-reinforcing,” Nadella explained.