Is Apple Ditching Google Search?
Technology Editor, CNBC.com
Apple is positioning itself to abandon all of Google's products, including their almighty search product, Ben Schacter, an internet analyst for Macquarie Research, told CNBC's“Squawk on the Street” Tuesday.
"This is an issue we think is going to happen ultimately," Schacter said. "Whether it happens this week or next week on the iPhone 5 or iOS6 launch, we don't know for sure. But we think ultimately, we will see these companies completely apart, and that means apart even on search." \(Read More: Apple Will Make Big Announcement Next Week, Hints at iPhone 5.\)
Apple announced earlier in June at its annual developers conference that it wasditching Google Mapsfor its own mapping system and since then there has been much speculation about whether the iPad maker would also soon be scrapping Google search. The iPhone maker also announced this summer that it would no longer have YouTube, which Google owns, pre-installed on its next generation iPhone.
Apple announced Tuesday it will host an event Sept. 12 where the the iPhone 5 is expected to be revealed. While it is not clear if the company will replace Google search on the new iPhone that is anticipated for next week, there's no doubt Apple will remove the search feature eventually, Schacter said.
"These companies are true competitors in every sense of the word now. If you think about how they are actually attacking the market, they are really competing everywhere," Schacter said. "It's not just search or maps, they are competing in every sense of the word now, in terms of having products that are very different for the end user."
Currently, Google search is the default search engine on Apple's devices. Advertisers pay Google for clicked ads and then Google pays Apple. While Google may lose profits if Apple removes its search engine from Apple's products, it could also stand to benefit.
"In the future, if they were to move away from Google, you would have to go to Google direct and Google could keep 100 percent of the economics," Schacter said.
Schacter said that while he sees Apple dropping Google search, he doesn't see the iPhone maker turning to another search engine like Microsoft's Bing to replace Google in its products. Rather, he said Apple is likely to adopt more of an app-centric search for users.
'We don't think this a matter of Apple versus Bing, it's much more about will Apple use that app culture," Schacter said. "Will they (Apple) go to Yelp? Will they go to OpenTable? Will they go to third party vendors to really answer peoples' questions? And that's what we think could happen over time."