Google pays to be the default search because they make more from selling ads on those searches than they are paying for the search.

I don't see the same thing here. Google isn't making any money from being the assistant in Apple, so why would they pay to be it?

Yet? Maybe they are but embedding adds or paid signal amplification/probability tweaking has already been floated on the market and may already be a product.

For Google, search quality is a moat. And it's becoming apparent that AI quality is a moat as well.

It doesn't matter if it's classic search or LLM. They can monetize tracking information as easily as they can sell ads. They'll have fast cheap custom-built assistant models that run on device by default, keeping things profitable. In time they'll likely double-dip again by injecting product placement in results.