If anything, web search would be counterproductive for them. Google likes search because you see ads on search results then go to other pages and see more ads.
Apple doesn't have that incentive; if anything they want to keep you in the App Store's curated experiences. Why send someone to an Open Street Maps website instead of one of the various OSM clients on iOS where you can get extra features via in-app-purchase?
Maybe they actually just want their end users to have a great web search experience? They added DuckDuckGo as an option to their OSes recently and I'm sure they would be happy to not feed any more traffic to Google than strictly necessary.
It could benefit Siri making the built in web search more intelligent instead of leveraging a 3rd party API who might even charge for access since there's no ads.
It might even sell more devices if they make it an Apple device exclusive service, or at least as a gateway to lure new customers kinda like the online versions of icloud/pages/numbers/keynote.
I am doubtful this is to take on Google directly, and I am sincerely doubtful that they'd be able to pull it off if it was. Microsoft funneled billions in to competing, and it has mostly fizzled. Google has had too much of a head start to be competed with head-on.
> What ad-free business model can monetize search?
The one where you make craptons of profits selling high-margin devices that come bundled with services that offer ad-free user experiences and maximum privacy.
And it's Google that pays Apple a fortune to be the current engine, not the other way around. Just to give you an idea of who holds the cards here.
I don't think ad free or privacy is a big winner for sales or user experience. However the future of the platform involves more and more search like actions and iOS's current answer of 100 different services spaghetti'd together under Siri (or use Google in Safari) is kludgey and half-baked today and certainly not a long term solution.
Apple likes to control all the parts of the user experience and search is going to get bigger every year.
There is no way they would make enough from iPhones/iPads to pay for the costs of building and running a competitive web search engine. (At least not one built like Google and Bing are)
There is a reason they take a cut of profits from App developers; it's to help pay for the cost of running the App store.
They're generating profits at a rate of $200 Million per day [sic]. It's fair to say they make enough to pay for the costs of almost anything, including this. You've identified the one requirement they can in fact satisfy; the hard part is... everything else.
Assuming you're right about their profits, that's 18B per quarter. Operating cost have been said to be around 5B per quarter for Google and 1.25B per quarter for Bing.
Bear in mind they're already running their own competitive map service for exactly the same reasons I say they want to run their own web search. And that's probably not cheap either.
1. $5B is super way off. First of all you are lumping one-time construction costs in with the incremental costs of running the data centers. The article clearly states the bucket in which data center operational costs are included is $2.82B.
2. Even that bucket is a grab bag of other costs as well such as amortization of acquired assets (not necessarily for data centers). Additionally while web search is major it is certainly not the only thing that Google data centers do; for example they run Gmail and an AWS competitor on it. So it's very hard to determine just what the operational cost of web search is, but it's certainly well under $2.82B.
3. The Bing article clearly states its major cost increases are "costs associated with the Yahoo! search agreement and increased traffic acquisition costs", i.e. promotional not operational costs. This is not applicable to Apple, who already gets paid for traffic.
4. As for maps it's not just GPS data, it's road and signage and building data including visual imagery. That's many orders of magnitude more expensive to gather than loading a web page (even loading it 1000 times). You have to roll trucks and fly planes. In fact there was just a story yesterday about Apple rolling trucks to start gathering competing "streetview" data.. all from scratch.
Chatting about this with you made me challenge my knowledge of how web search works. Many articles I've found suggest that the hardest problem to solve isn't competing on the size of Google but the relevance of Google. Which is partly to do with the size and power of their datacenters. But also to do with smart engineering of the servers, database, and algorithms. The algorithms not only determine the how to order the results but which pages to crawl and how often.
What this all makes me think of is all the work being put into AI research lately. IBM, Google, Facebook, Baidu etc. There is a race to AI and the winner could very well make a better Google.
They started running their map service because google was about to start charging for Google Maps.
iMaps already had a rollout that felt improvised and pretty crappy, if the Apple people were suicidal enough to get in a huge business they have absolutely no idea about, such as Web Search, I wouldn't expect a barely usable product in years.
I don't remember anything about a fee, but I do specifically recall something about Google withholding from the iOS version two greatly desired features that had already been deployed on Android: vector tiles and turn-by-turn directions. The lack of the latter, at least, was beginning to rise to the level of consumer awareness as an iOS weakness.
You're right with those numbers, but it's only half if you take the year's average per day. I was referring to their current rate (as of the most recent quarter, during which they earned $18B). $18B gives the nice, round, shocking $200M/day, but even $100M per day isn't half bad.
>There is no way they would make enough from iPhones/iPads to pay for the costs of building and running a competitive web search engine. (At least not one built like Google and Bing are)
Well, they are like double the market cap of Google, and (where it matters) they have astonishingly higher profits and revenue than it, to the point that it's like corner-store vs Amazon.
Bing is just on Siri and Spotlight in Yosemite. All versions of Safari still default to Google. In fact that default deal will end soon, and Bing and Yahoo want to replace Google as the default.
Google screwing with phones, Apple will screw with search. Apple isn't running out of money or smart people, so they probably have a shot if they want it.
Apple operates as though they do not have competitors, they only care about making the best possible devices they can, which is why they are so profitable. Chasing Google is the opposite of The Apple Way.
Apple has a very hard time attracting and keeping the best people, just like Google, Facebook, and everyone else. By definition the best people are always going to be scarce. Not everyone can be above average, and only a few can be the best.
Agreed. And to do this "local" search you could imagine it being much better using signal from the web (who is linking to what content in iTunes, etc).
I've wondered to myself why they didn't buy DuckDuckGo and just integrate. I'm sure there are 1000 good reasons not to do it, but I did wonder it to myself. Especially since they seemed to put it in the spotlight with the iOS8/Yosemite release. Privacy is now a legitimate selling point and people would probably be willing to pay for services and tools that value that. But I guess there is no value in buying it so that would be why.
Possibly not significant, but I noticed the location's given as San Francisco - normally, Cupertino-based positions are tagged as "Santa Clara Valley".
That job ad doesn't indicate that Apple is going into the search business. Getting into search would need a bigger team.
Given the publicity, this may be a bluff by Apple. Yahoo did something similar. In early 2014, Marissa Mayer announced that Yahoo was going to build their own search engine. Nothing happened. That seems to have been a ploy to get a better deal from Bing.
I was under the impression that large tech companies shift devs to different projects often, but Apple does seem like it is already strained by its number of software products.
Yahoo never staffed up to build a search engine. That would have been noticed in Silicon Valley. They hired a VP for search whose previous area of expertise was negotiating with Microsoft.
I suspect content search. Imagine people's home filled with Apple TV, Macbook and iPad. Now what you need is content search. TV program search is done, and it isn't really much exciting than Netflix's suggestion. What about content people bought? Browsing history? Payment history? Medical? Calendar? Travel? Weather? They have a whole ecosystem they built since last release. As other speculates, a refined but better, unified version of spotlight, not just for iOS or OSX, but a truly search with their devices connected. With Sri now you can ask at home like Amazon's Echo, or ask Sri when you are driving. Content search is what matter these days.
If there is one company that has the pockets and audience big enough to compete it is Apple. They will have to a hire an enormous number of the best search people to do it though.
The Apple Maps experience is evidence against that, though. We know that they were working on maps for years and things like PoI search were among the biggest issues. I find it hard to believe they would have done that badly if they had an in-house search team (if only because such a team would have been good at flagging problems and suggesting solutions).
I agree. I don't think you can hide hiring the right search people. They have pulled in a few search companies, but nothing at the scale necessary (e.g. Topsy).
Maps are a bit different to web search though. There was never a Google Maps-quality geographical database available for sale; to get good maps Apple has to send people out into the world to compile the data. It was inevitable that any competing map service would start out underwhelming, because mapping is a job that intrinsically requires a good deal of time and actual physical work to make it high quality. Web search is different; that's something you can build almost entirely in secret (apart from the odd hint when someone spots a new user agent string), without having to step out of your metaphorical basement until it's fully baked.
Apple was at Lucene Revolution in DC this past fall. It's a little silly IMO to extrapolate too much from a job posting -- Apple has had a large search infrastructure for a long time, as do most tech companies.
I'm really not sure why people think Apple would get into the web search business. Web search represents just a fraction of the total advertising spending that other web companies like Facebook aren't even bothering to chase Google for it. Google's stock has been in the toilet this year because their core business is facing shrinking ad margins from the shift to mobile, it doesn't make any financial sense to get into that business.
Add that to the fact that this is completely out of Apple's wheelhouse and their history of relatively never straying out of their circle of competence and it should be pretty clear that this isn't for web search.