The UK Competition and Markets Authority (CMA) has formally introduced designated Google with strategic market standing (SMS) beneath the brand new digital markets competitors regime. Specifically, it discovered that Google has “substantial and entrenched market energy and a place of strategic significance” in the case of basic search providers and search promoting. The digital markets competitors regime got here into drive on January 1, 2025 and can permit the company to “promote competitors in quickly evolving digital markets, whereas defending UK shoppers and companies from unfair or dangerous practices by bigger expertise firms”.
So what precisely does it imply to earn the “strategic market status” designation? As the CMA makes clear, this doesn’t mechanically imply that Google has performed one thing fallacious, however it does permit the company to launch interventions that be sure that basic search providers within the UK are “open to efficient competitors” and that firms that depend on Google are handled pretty. The firm expects to face new guidelines and rules about how Search works within the close to future. The UK’s CMA launched an investigation into Google’s place within the search trade on January 14 to substantiate its standing.
“We have found that Google maintains a strategic position in the search and search advertising sector, with more than 90% of searches in the UK taking place on its platform,” mentioned Will Hayter, Executive Director of Digital Markets at CMA. To be clear, the designation additionally applies to the corporate’s AI Overviews and AI Mode options, however not its Gemini AI assistant, no less than for now.
The CMA mentioned it hopes to begin consulting on doable interventions later this 12 months. in a commercial For its half, Google mentioned that “lots of the intervention concepts which were raised on this course of would inhibit UK innovation and development, probably slowing product launches at a time of profound AI-based innovation.” The firm believes a few of these concepts “would instantly hurt companies” and will result in greater costs for shoppers.
“The UK enjoys entry to the newest services and products earlier than different nations as a result of it has to this point averted expensive restrictions on in style providers similar to Search. Maintaining this place means avoiding unduly onerous rules and studying from the unfavourable outcomes seen in different jurisdictions, which have value companies an estimated €114 billion,” Google wrote. By “different jurisdictions,” Google means the European Union, whose related Digital Markets Act legislation designated the corporate as gatekeeper in 2023.
