In a significant move to curb the power of Big Tech, the UK’s digital regulator has taken direct aim at Google’s dominance in the search market. The Competition and Market Authority (CMA) has conferred “strategic market status” on the company, a designation under new legislation that unlocks the power to order a major overhaul of its UK services.
The decision is a direct result of Google’s market saturation, with the company controlling more than nine out of every ten searches conducted in the UK. This entrenched position, the CMA believes, requires a specialized regulatory approach to ensure a fair and competitive digital economy. The new status serves as the legal foundation for future interventions.
The CMA is now preparing to consult on a series of potentially transformative changes. A key proposal is to mandate “choice screens,” giving consumers a simple way to opt for alternative search engines, with a specific mention of including AI-first services like ChatGPT. Other ideas include rules for unbiased search rankings and greater rights for content creators and publishers regarding their work’s use in AI features.
While the CMA sees this as a crucial step to “unlock opportunities for businesses” across the UK, Google has voiced concerns. A senior figure at the company cautioned that the proposed regulations could hinder growth and innovation at a pivotal moment for AI development. This view is challenged by legal analysts who believe the UK is right to address the market imbalances caused by Google’s long-held monopoly.
This is the first time the Digital Markets, Competition and Consumers Act 2024 has been used to designate a firm with SMS. The CMA clarified that no immediate penalties will be applied, but the designation triggers a process for developing new rules. A similar review of Apple and Google’s dominance in the mobile phone platform market is also underway.