Default or bust (at least up to $15 billion in losses)

I haven’t been following the U.S. vs Google anti-trust very closely, but it is noteworthy how Microsoft CEO Sataya Nadella said, according to The Verge, that he would be willing to lose $15 billion per year for Bing to be the default search engine on iOS.

Sataya Nadella also said: ““Defaults are the only thing that matter,” he said, “in terms of changing user behavior.” He called the idea that it’s easy to switch “bogus.””. Microsoft’s argument in this case is obviously based on their self-interest, and could have been different had the situation been different.

The value of being the default is large, but it seems like the best competitive situation is decided by a combination of the best product, the best economics and being the default.

Author: Henrik Torstensson

Partner at Alliance VC. Investing in Nordic early-stage tech startups.

Leave a Reply