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Possible Bing deal could backfire for Apple, say analysts

updated 03:45 pm EST, Wed January 20, 2010

Would conflict with cult of Apple

It would be a serious mistake for Apple to contemplate switching to Bing as the default search service on the iPhone, say Oppenheimer analysts. News emerged today that Apple may be in talks with Microsoft, looking to make the switch as a means of distancing itself from Google. Google has its own phone platform, Android, and still earns money from the ads displayed in iPhone search results.

The corporations are in conflict, says Oppenheimer's Yair Reiner, because Apple wants to be the "special box in a world of generic services," whereas Google intends to be the "special service in a world of generic boxes." Turning to Microsoft could however be a mistake for Apple, Reiner argues, given that Apple has persuaded the public to adopt an anti-Microsoft bias through its Mac vs. PC campaigns. "Cozying up [to Microsoft] could bring more risk than reward, not least because it would clash with the Mac vs. PC campaign and the Apple brand identity that has coalesced around it," says the analyst.

A CNBC source meanwhile claims that talks have been ongoing since October or November, and that there are several reasons the deal may be coming about. Microsoft for instance has discovered that the Bing iPhone app generates more queries than any other mobile form of the service, including even the search integrated throughout Verizon's network. The company is also believed to be willing to sacrifice more of its advertising income than Google, which pays Apple a small amount for every ad tap on an iPhone.

Apple CEO Steve Jobs is said to recognize Bing as a search API that can be deeply integrated into products without displaying Bing webpages or interfaces. In contrast to other reports, the source adds that Jobs "cannot and will not build a [proprietary] search engine," mainly because of the expertise needed. Apple just wants to insert its own ads into first-party iPhone apps, the person says.

It is further alleged that "Jobs hates Eric," referring to Eric Schmidt, Google's CEO. The two once served on the Apple board, and have participated together in press events. No explanation for the animosity has been offered.




by MacNN Staff

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Comments

  1. LEStudios

    Joined: Dec 1969

    0

    This feels like your parents in a divorce...

    then choosing who to stay with. This is why I didn't want Apple and Google to end their relation ship like this! I don't know what to say but I really don't feel like Bing!

  1. Le Flaneur

    Joined: Dec 1969

    +6

    let's hope it's not true

    Please, Apple, do not bing us unhappiness!

  1. bobolicious

    Joined: Dec 1969

    +2

    dogpile

    does both http://www.dogpile.com/

  1. rytc

    Joined: Dec 1969

    +2

    Dear god

    No! Let this not be true!!

  1. noibs

    Joined: Dec 1969

    +1

    Apple...DON'T YOU DARE!!!

    Google is an Apple competitor and Microsoft is slime. I can see myself some day with an Android device. I don't and won't use any Microsoft software or hardware. Microsoft is pond scum and slime...seriously.

    Google is trying to develop cool products for INDIVIDUALS. When Microsoft markets a product to an individual there is always the unmistakable feeling that Microsoft's first priorities were to please IT professionals before the individual user. How many Windows users (any version of Windows) believe that Microsoft put the needs of individual users ahead of IT professionals who administer vast networks of Windows drones?

    And...while I'm on a roll, I'm not that thrilled by other things I've been reading about Apple lately. Things like streamed ads, for example, and subscriptions plans for music.

    My original reason for going with Apple was freedom. If they begin to corral users and forcing them into behaviors that the user doesn't naturally want to go in, then I'll be perfectly happing moving to Linux.

    I already use every open source app I can and I support open source with dollars. I'm getting ready to buy a Dell Vostro V13 full size, super-slim net/note-book with Linux. For $470, it's an amazing value...an astounding value.

    So Apple...keep thinking different and don't become a worse version of Microsoft.

  1. koolkid1976

    Joined: Dec 1969

    +7

    Really?

    So did it backfire on Apple for selling and promoting MS Office? Or when they ditched PPC for Intel? And they certainly flip back and forth between NVIDIA and ATI over the years. They also switch between suppliers and manufactures. If there is one thing Apple hardly does, is blindly stick to one partner out of loyalty. They play the field.

  1. Constable Odo

    Joined: Dec 1969

    +1

    Maybe it's just a stopgap measure

    before Apple builds its own search engine. Right now, Apple is trying to divide and conquer. Microsoft has almost no mobile share to speak of so that's no threat to Apple. Apple is likely trying to cut into Google's mobile ad click revenue. I've only used Bing a few times but found it lacking in hits. If I could change the search area in Safari I would try Bing more often.

    As a company grows in size I think they'd have a tendency to to take away user's freedom. They would try to control the funneling of more revenue in their direction. Apple is out to make more money, and using ads is likely the next step. Mobile ad revenue is supposedly going to be huge for those that control it. As an Apple investor, I say they should go for it.

  1. Lo_Ruhamah

    Joined: Dec 1969

    +2

    I'm surprised no one has stated the obvious...

    That this is a rumor from two "anonymous" sources and probably won't happen anyway.

  1. dwoodruff

    Joined: Dec 1969

    +1

    good thing....

    ... it's not true

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