>Spending huge sums of money. Or receiving huge sums of money. Which would you prefer?
No, that's not the way too look at it. Apple spending billions to buy the Bing search engine would then let Apple collect 100% of the search ads revenue instead of splitting someone else's ad revenue with a middleman (aka Google).
So the business decision matrix is based on whether 100% of ad revenue minus the acquisition & ongoing maintenance costs of Bing -- would be worth more than X% of Google's revenue split.
Acquiring the "Bing search engine" isn't just the index ranking algorithm. It also includes getting the whole back-office infrastructure of ads-monetization management & dashboards for advertisers to log in to bid+buy ads.
Google is apple's main competitor and building an actual rival might be extremely beneficial for them.
Google supposedly makes more money from this arrangement then the spend, which means of apple can run a successful search engine they can take more of the profit.
Apple has loads of cash which they look for ways to invest, Google shows that search engine can be an immensely valuable investment.
Obviously there are other concerns, chief being consumer sentiment here I imagine.
I don’t think it’s quite that simple. Google are, after all, Apple’s biggest competitor in the mobile space and Android has Google search deeply integrated. By comparison Apple’s Google search integration is always going to look inferior, it would make sense if they sought to bring it all in house.
Or perhaps not. You may note that yesterday Head of Engineering and Product for Bing said [0]:
"Many people ask me whether LLMs will make web search engines less valuable, but the opposite is actually the case. LLMs make web search more critical than ever, since the combination of LLMs + web search is what produces fresher and more accurate chat results."
This is true, but what he didn't mention is where the the biggest source of pre-training data is from. This was revealed earlier this week by his colleague Mikhail Parakhin, CEO of Microsoft Ad and Web Services, in the Google antitrust trial. Apparently he revealed "Bing Chat and Google Bard leverage indexes." [1].
A point on which I speculated on back in February [2].
Why does neither Microsoft nor Google nor Apple take the lead and offer free LLM answers like Google offers free search results?
Is that because there are simply not enough GPUs out there to do this at scale?
If so, it will become really interesting once that constraint goes away. There might be a shift in the search space like there was a shift from analog to digital photography.
Even if there's enough GPUs they also needs to be available at a cost that makes it financially viable, both in terms of purchasing price, but also power and cooling. Environmentally it might not look to good to offer LLM answers to a wider audience, there are already concerns about the water consumption of ChatGPT in some regions, see: https://fortune.com/2023/09/09/ai-chatgpt-usage-fuels-spike-...
The article makes it a little fuzzy if Apple would have bought Bing outright, taking it completely of Microsofts hands, or if they would have bought access to including it in Apple products.
Had Apple bought Bing they'd most likely have taken it private and not offered its search API to others, effectively preventing the creation of search engines like DuckDuckGo and Ecosia.
"The money generated by the Google deal was a key reason why Apple declined acquiring Bing, according to the people" .... "with knowledge of the matter"
At current P/E and an estimated $18bn the deal is worth half a trillion $.
Ultimately though it’s clear that Google and Microsoft place high value on Apples customers, who are much richer and spend more money than customers using Android or other devices.
No company has that kind of user base that Apple has. They do this by designing the best products and services for a very high premium price that attracts those users. It’s remarkable that they can release a phone for $1600.00 (pro max with 1TB storage) and sell millions of them every year.
I use Apple products and I am in no way, in any sense of the word, "rich". I'm not even close.
And why is it that someone tries to show how expensive Apple products are, they always list the highest end, most tricked out product? "oh, a Macbook Pro costs over $5000 dollars, but you can get a Windows laptop for only $450!"
I'm typing this on a desktop Mac that costs less than a typical video card on a PC. But hey, I'm "rich".
I'm not 100% sure that being wealthier explains it all. Over the past 15 years I've owned Android and iOS/iPadOS devices and I've spent a lot more in the Apple App store.
During that whole time I've also owned a Windows computer and I've spent even less in the Microsoft app store. I'm not sure I've ever spent a dime on Linux (other than ordering some distros on CD before I had a good internet connection).
> It’s remarkable that they can release a phone for $1600.00 (pro max with 1TB storage) and sell millions of them every year.
It's not that remarkable. I keep my phone 3 years so it works out to a little more than $1 / day factoring in trade-in or resale at the end of that time. A lot of people can afford that.
Stuff so great you'd have to pay me to use it. In my books, Apple prices are just a tax on people who are bad with computers and organizing their own stuff in the same way lotteries are a tax on not understanding basic math.
They don‘t need Bing. They‘re working on their own AI, and AI will replace all search engines. ChatGPT is already slowly but steadily killing Google as we speak.
[+] [-] alberth|2 years ago|reply
They are receiving $19B in annual revenue today by having Google as default search engine (which is all profit for them).
Or they could spend billions on the acquisition of Bing + more billions annually to run Bing.
Spending huge sums of money. Or receiving huge sums of money. Which would you prefer?
[+] [-] jasode|2 years ago|reply
No, that's not the way too look at it. Apple spending billions to buy the Bing search engine would then let Apple collect 100% of the search ads revenue instead of splitting someone else's ad revenue with a middleman (aka Google).
So the business decision matrix is based on whether 100% of ad revenue minus the acquisition & ongoing maintenance costs of Bing -- would be worth more than X% of Google's revenue split.
Acquiring the "Bing search engine" isn't just the index ranking algorithm. It also includes getting the whole back-office infrastructure of ads-monetization management & dashboards for advertisers to log in to bid+buy ads.
[+] [-] kortilla|2 years ago|reply
[+] [-] Illniyar|2 years ago|reply
Google is apple's main competitor and building an actual rival might be extremely beneficial for them.
Google supposedly makes more money from this arrangement then the spend, which means of apple can run a successful search engine they can take more of the profit.
Apple has loads of cash which they look for ways to invest, Google shows that search engine can be an immensely valuable investment.
Obviously there are other concerns, chief being consumer sentiment here I imagine.
[+] [-] aka878|2 years ago|reply
[+] [-] afavour|2 years ago|reply
[+] [-] TradingPlaces|2 years ago|reply
[+] [-] rchaud|2 years ago|reply
[+] [-] unknown|2 years ago|reply
[deleted]
[+] [-] blibble|2 years ago|reply
[+] [-] bsuvc|2 years ago|reply
A lot is going to change in how search, and the associated business model, works in the next few years.
[+] [-] ColinHayhurst|2 years ago|reply
"Many people ask me whether LLMs will make web search engines less valuable, but the opposite is actually the case. LLMs make web search more critical than ever, since the combination of LLMs + web search is what produces fresher and more accurate chat results."
This is true, but what he didn't mention is where the the biggest source of pre-training data is from. This was revealed earlier this week by his colleague Mikhail Parakhin, CEO of Microsoft Ad and Web Services, in the Google antitrust trial. Apparently he revealed "Bing Chat and Google Bard leverage indexes." [1].
A point on which I speculated on back in February [2].
[0] https://twitter.com/JordiRib1/status/1707103407050477772
[1] https://twitter.com/jason_kint/status/1706866080130498939
[2] https://blog.mojeek.com/2023/02/will-chatbots-kill-the-searc...
[+] [-] mobilio|2 years ago|reply
[+] [-] UpToTheSky|2 years ago|reply
Is that because there are simply not enough GPUs out there to do this at scale?
If so, it will become really interesting once that constraint goes away. There might be a shift in the search space like there was a shift from analog to digital photography.
[+] [-] bayindirh|2 years ago|reply
Instead, I'm using Kagi, and feeding it old school search queries. Which provides me results I want in the first three slots, all the time.
Why fix something ain't broken?
[+] [-] guiriduro|2 years ago|reply
[+] [-] mrweasel|2 years ago|reply
[+] [-] diffeomorphism|2 years ago|reply
Even if you had the GPUs, compute and electricity cost money:
https://medium.com/@zodhyatech/how-much-energy-does-chatgpt-...
[+] [-] drewcon|2 years ago|reply
[+] [-] mrweasel|2 years ago|reply
Had Apple bought Bing they'd most likely have taken it private and not offered its search API to others, effectively preventing the creation of search engines like DuckDuckGo and Ecosia.
[+] [-] ColinHayhurst|2 years ago|reply
At current P/E and an estimated $18bn the deal is worth half a trillion $.
[+] [-] victor106|2 years ago|reply
No company has that kind of user base that Apple has. They do this by designing the best products and services for a very high premium price that attracts those users. It’s remarkable that they can release a phone for $1600.00 (pro max with 1TB storage) and sell millions of them every year.
[+] [-] GoofballJones|2 years ago|reply
And why is it that someone tries to show how expensive Apple products are, they always list the highest end, most tricked out product? "oh, a Macbook Pro costs over $5000 dollars, but you can get a Windows laptop for only $450!"
I'm typing this on a desktop Mac that costs less than a typical video card on a PC. But hey, I'm "rich".
[+] [-] gruez|2 years ago|reply
So? The galaxy s23 ultra 1tb has msrp of $1619.99
https://www.samsung.com/us/smartphones/galaxy-s23-ultra/buy/
[+] [-] criddell|2 years ago|reply
During that whole time I've also owned a Windows computer and I've spent even less in the Microsoft app store. I'm not sure I've ever spent a dime on Linux (other than ordering some distros on CD before I had a good internet connection).
> It’s remarkable that they can release a phone for $1600.00 (pro max with 1TB storage) and sell millions of them every year.
It's not that remarkable. I keep my phone 3 years so it works out to a little more than $1 / day factoring in trade-in or resale at the end of that time. A lot of people can afford that.
[+] [-] johnnyworker|2 years ago|reply
Stuff so great you'd have to pay me to use it. In my books, Apple prices are just a tax on people who are bad with computers and organizing their own stuff in the same way lotteries are a tax on not understanding basic math.
[+] [-] ChrisArchitect|2 years ago|reply
[+] [-] ChrisArchitect|2 years ago|reply
[+] [-] hackerbeat|2 years ago|reply