Why Apple’s lead in the mobile browser space affects Google
Browser wars: Google's browsers surpass Microsoft's in the US (Part 2 of 6)
Google is way behind Apple in U.S. mobile browser market share
In the previous part of this series, we discussed how Google (GOOGL) has surpassed Microsoft (MSFT) in U.S. browser market share when you look at both desktop and mobile browsers. But, according to the same report from Adobe (ADBE) Digital Index, Google is way behind Apple (AAPL) in the battle for mobile browser market share. As the chart below shows, as of April 2014, Apple’s Safari’s U.S. mobile market share of 59.1% is way ahead of Google’s Android and Chrome mobile browsers, at 20.3% and 14.3%, respectively. Opera and Internet Explorer are smaller players, with market share of less than 3% each.
Apple has started to replace Google with Bing as the default search engine
During the recent WWDC event, Apple announced that Microsoft’s Bing will be the default search engine in the redesigned Spotlight search feature for the upcoming iOS 8 and OS X Yosemite. Bing could replace Google as Apple’s default search engine. Last year, Apple made Bing the default search engine for its Siri application. The main reason Apple replaced Google with Bing is that Google is Apple’s main competitor in the mobile market—not Microsoft. Plus, the relations between Apple and Microsoft have improved lately. A few months ago, Microsoft launched its Office application for iPad. This move emphasized the improving relations between the two tech giants.
How does this affect Google?
Users tend to use the default search engine on their device. A search engine’s default status on an operating system helps generate more advertising revenue. Search-related revenues are important for companies like Google. They contribute a major portion of Google’s revenues. So Apple’s increasing dominance in the mobile browser market, and its tendency to favor Microsoft to Google’s detriment, is bad news for Google and ETFs like the iShares Dow Jones US Technology ETF (IYW) and First Trust Dow Jones Internet Index (FDN). These ETFs have high exposure to Google.
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