Google Faces Enforced Changes in UK After Watchdog’s “Strategic” Designation

The UK’s competition authority has officially designated Google with “strategic market status,” a powerful classification that allows the regulator to enforce changes to its search and advertising businesses. This action by the Competition and Market Authority (CMA) is the first use of new powers designed to oversee tech giants with significant market influence.
The designation stems from Google’s dominant position, where it handles over 90% of UK search queries. The CMA argues this level of control necessitates a special regulatory regime to promote competition. The “strategic market status” (SMS) gives the authority the legal backing to impose new rules and conduct requirements on the company.
Among the potential mandates being considered are “choice screens” to make it easier for users to select rival search engines, including AI-driven platforms like Perplexity and ChatGPT. The CMA is also proposing rules to ensure fair ranking in search results and to give publishers more control over how Google uses their content, particularly in AI-summarized answers.
Google has warned that such interventions could negatively impact UK consumers by slowing down innovation and product launches, especially in the rapidly evolving AI sector. However, competition law experts have praised the move, stating that the CMA is now equipped to tackle market distortions, bringing the UK in line with regulatory efforts in the US and the European Union.
The CMA has stated that this decision is not a finding of wrongdoing but a necessary first step before it can consult on and implement pro-competitive measures. The consultation is expected to begin later this year. The regulator is also using the same new law, the Digital Markets, Competition and Consumers Act 2024, to assess the market status of Apple and Google’s mobile operating systems.