The Leadership Letter

Real correspondence from the people running real companies — and what it reveals about leadership.

Price Your Distribution Power Honestly

When a partner asks for the same price on a worse deal, the right answer starts with naming what you're actually buying.

Deal Overview

• Current deal terms: Google default (and exclusive) search provider in Safari browser; 50% Net Revenue Share after 10% deductions for queries stemming from the Apple browser chrome; term through January 2008.

• What Apple wants: Launching Safari for PCs and wants current deal terms to apply to this new OS; Google to be one of two possible choices for search provider (not default), with user required to choose search provider prior to using browser; Apple wants current deal terms to extend to Safari browser for PC OS; contract open re: OS, but requires Google to be the default search provider to qualify for revenue share.

• Key issues: Apple uncooperative vis-à-vis Google's efforts on Chrome utilizing their open source platform; strategic considerations with respect to supporting PC version of Safari vis-à-vis Chrome launch plans; revenue share seems rich for non-default and non-exclusive deal.

Impact if Existing Deal Terms

• Likely Scenario: Assume new browser has same chrome query growth as Firefox had in its first year; apply the rev share we give Safari (45% of gross); annual rev share payment to Apple would = $90M.

• Aggressive Scenario: Assume new browser comes out of the gate with the same worldwide market share as Firefox (20%); annual rev share payment to Apple would = $205M.

This edition is for members.

The daily letter is free. The archive — every prior edition, fully searchable — is for members. Sign in to start your free week.

Court Exhibit
United States v. Google LLC (Search)
1:20-cv-03010 (DCD), Trial Ex. UPX0126 — DOJ public archive
June 4, 2007
Public domain
View the primary source →