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Court Filing Offers Rare Peek at Finances of Android

Court Filing Offers Rare Peek at Finances of Android

By Reuters | Updated: 23 January 2016 13:40 IST

Google Inc paid Apple Inc $1 billion in 2014 to keep its search bar on the iPhone, Bloomberg reported, citing a transcript of court proceedings related to a copyright lawsuit filed by Oracle Corp against the search giant.

Google, a unit of Alphabet Inc , gives Apple a percentage of the revenue it generates through the iPhone but details of the arrangement have never been made public.

In a portion of the document reviewed by Reuters, an Oracle attorney also claimed that Android had generated revenue of about $31 billion (roughly Rs. 2,10,258 crores) and profit of $22 billion (roughly Rs. 1,48,673 crores) since its release.

While the transcript did not give a date, the first commercial version of Android was released in September 2008.

"Assuming Android has only generated material revenue since 2010, then these figures would constitute about 10 percent of Google's revenue and 15 percent of its gross profit since that time," Atlantic Equities analyst James Cordwell told Reuters.

"This makes sense given mobile is probably about 40 percent of Google's revenue today, having ramped up from close to zero over the last 5-6 years, with this split between iOS and Android," Cordwell added.

Both revelations offer a rare peek into the financial details of Android, a critical product for Google as users shift their search efforts from desktop PCs to mobile devices.

When Oracle's attorney discussed details about Google's relationship with Apple at the Jan. 14 hearing, Google's attorney objected and argued that information should be sealed. Five days later, US Magistrate Judge Donna Ryu denied Google's request.

Google asked Ryu to reconsider her ruling on Thursday, which has not yet been decided. However, a copy of the transcript became available at the courthouse on Thursday.

The court removed it from public view a few hours after posting it as a Reuters reporter was reviewing it, presumably to allow Google to litigate its request to rehear the secrecy issue.

A court official was not immediately available for comment.

In its story, Bloomberg reported that a Google witness had revealed that the revenue share between Google and Apple was 34 percent at one point.

However, it was not clear whether that percentage represented the amount kept by Google or paid to Apple, the report said.

In its lawsuit, Oracle accused Google of using its Java software without paying for it to develop Android.

Google and Apple did not respond to requests for comment on Friday.

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