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Apple is looking into adding artificial intelligence (AI)-powered search engines to Safari, which could end its $20 billion yearly deal with Google.
Eddy Cue, Apple’s Senior Vice President of Services, revealed during his May 7 testimony at the US Justice Department’s antitrust case against Alphabet that Safari searches fell for the first time in 22 years last month. He attributed this decline to users increasingly turning to AI tools instead of traditional search engines.
This news caused Alphabet’s stock to fall 7.3% on Wednesday, erasing about $150 billion from its market value. Apple’s shares also went down 1.1% after Cue’s testimony.
Apple’s potential change comes as regulators examine the long-standing arrangement between the two tech giants. Google currently pays Apple about $20 billion per year to be Safari’s default search engine, which makes up roughly 36% of Google’s search ad revenue from Safari.
Apple explores AI search alternatives
Apple is considering AI search alternatives like OpenAI’s ChatGPT, Perplexity AI, and Anthropic. Bloomberg reports that Apple has already talked with Perplexity AI about a possible Safari integration.
“Prior to AI, my feeling around this was, none of the others were valid choices,” Cue stated during his testimony. “I think today there is much greater potential because there are new entrants attacking the problem in a different way.”
Cue made it clear that these AI search options probably wouldn’t replace Google as the default right away. “We will add them to the list – they probably won’t be the default,” he said, indicating they still need improvements.
This integration aligns with Apple’s broader AI plans. The company will include ChatGPT in iOS 18 through Siri and might add Google’s Gemini AI later this year. Cue mentioned Apple also looked at other AI providers, including China-based DeepSeek and Elon Musk’s Grok.
Google loses search monopoly
Market analysts warn that losing exclusive default status on Apple devices could severely impact Google’s advertising business.
“The loss of exclusivity at Apple should have very severe consequences for Google even if there are no further measures,” said D.A. Davidson analyst Gil Luria. “Many advertisers have all of their search advertising with Google because it is practically a monopoly with almost 90% share.”
Cue suggested we’re seeing a basic change in how people find information online. “You may not need an iPhone 10 years from now as crazy as it sounds,” he noted, emphasizing that technology shifts create opportunities for competition. “AI is a new technology shift, and it’s creating new opportunities for new entrants.”
Despite seeing future possibilities with AI search, Cue said Google should stay Safari’s default for now because of financial reasons. He admitted losing sleep over possibly losing revenue from the Google deal, which is important to Apple’s services division that brought in a record $26.6 billion in the March quarter.
This potential shift could reshape internet search and significantly impact the digital advertising world that Google has dominated for nearly two decades.
