Think about this for a second. That is $3 billion without any significant engineering effort, investment in technology, or anything else.
That is $3 billion of pure profit.
Apple’s profit margin is about 35% gross profit, so for sanity’s sake, let’s call it 1/3 gross margin.
It would take Apple an additional $9 billion in revenue to get $3 billion in profit.
For comparison’s sake, most tech companies would be thrilled to even add another $1 billion in revenue, much less profit.
For example, Twitter’s total revenue is $2.5 billion in 2017. And Twitter’s net income was a loss of over $100 million.
Twitter has never even made close to $1 billion in profit.
In fact, you could go through a big list of well known tech companies and find that $3 billion profit is pretty hard to come by.
So, from a business standpoint, Apple is likely making more money by NOT having a search engine than by building their own.
Now, if you compare this to the time and effort and resources it would take to build a search engine to compete with Google and Bing, it becomes obvious why Apple hasn’t gone down this road.
By investing in the iPhone, iPad, and Mac, Apple is using their resources better than if they built a search engine. I’d say that’s a smart move.
Source: Quora
