The battle for supremacy between Google and Apple could have yet another fallout. According to sources close to Apple, the company is in talks with Microsoft over a search deal that could see Apple replacing Google with Bing as the default search engine on the iPhone. According to the source, Apple sees Google as its primary rival and is drawing on support from Microsoft in order to challenge Mountain View. In the source's words, Microsoft is the "pawn" in the battle between Apple and Google.
The negotiation with Microsoft makes sense from more than one angle. Apple and Google compete in a lot of common areas and hence it makes sense for Apple to replace Google's search box with a competitor product in order to reduce Mountian View's influence over Apple's users. Meanwhile, Microsoft is itself looking for avenues to extend the reach of its search engine and would be more than willing to partner with Apple. Microsoft's desperation would mean that the company might offer to pay a higher annual flat fee than what Google currently pays Apple for the search engine partnership. Such an eventuality would not only help Apple strategically but also financially.
Having said that, another interesting piece of news that has come out is that Apple could in fact be looking to develop their own search engine. According to the source, even if the Apple-Microsoft partnership materializes, that could be short-lived and would merely serve as a stop-gap arrangement till Apple launches its own search engine to challenge the Big G.
If these rumors are true, the future rivalry between the two companies definitely looks exciting. With Google having encroached upon Apple's territory with Android and Nexus One and with Apple having invaded Google's territory with the acquisition of the mobile ad network,Quattro Wireless, an eventual entry into the search engine market could bring a hard-fought battle between the two companies which could only mean better things for us as customers.
What do you think?
[via Business Week]