U.K. CMA Investigates Google Search Dominance Under New Rules

U.K. CMA Investigates Google Search Dominance Under New Rules

The Competition and Markets Authority (CMA) has launched its first official investigation of 2025, focusing on Google’s dominance in search and advertising. This probe also includes Google’s advancements in AI-powered search. The investigation aims to assess competition in the search market and explore potential remedies to create a more level playing field.

The CMA’s new rules, introduced this month, allow for deeper investigations into Big Tech. Individuals and businesses can respond to the inquiry until February 3, 2025.

What the CMA is Investigating

The investigation will look into three key areas:

1. Weak Competition and Innovation Barriers: The CMA will assess whether Google’s dominance limits competition and stifles innovation in search. While competitors like OpenAI are advancing alternatives, Google still commands over 90% of search queries in the U.K.
2. Preferential Treatment: The CMA is examining whether Google unfairly favors its own services, especially in advertising and AI search results.
3. Data Usage Without Consent: Google’s use of consumer data and content from publishers will also come under scrutiny, particularly regarding informed consent.

The CMA aims to determine if Google’s search business qualifies as having “strategic market status” (SMS). This status would allow the CMA to enforce conduct rules or propose interventions to enhance competition.

Impact on Businesses and Consumers

More than 200,000 businesses in the U.K. use Google’s platform for advertising. The CMA highlighted that better competition in search could reduce advertising costs, potentially saving households up to £500 annually through lower product prices.

Sarah Cardell, the CMA’s chief executive, emphasized the importance of fair outcomes. She said:

“Millions of people and businesses across the U.K. rely on Google’s search and advertising services. It’s our job to ensure they benefit from choice and innovation while getting a fair deal. This includes how their data is collected and stored.”

AI’s Role in the Investigation

The rise of AI-powered search services, like ChatGPT and Perplexity, presents new challenges to Google’s dominance. These tools offer direct answers instead of links, creating competition in the search market. Google has responded with its Gemini AI, which delivers fully formed answers at the top of its search results.

The CMA is considering whether Google’s AI integration could require the inclusion of generative AI results from competitors.

Potential Outcomes

At its most extreme, the investigation could lead to proposals for breaking up parts of Google’s business. Other remedies might include:

• Allowing competitors more access to search results.
• Separating Google’s search engine from its advertising platform.
• Ensuring fair competition in AI search results.

The CMA is in regular contact with other regulators worldwide, as Google faces similar antitrust challenges in the U.S. and Europe.

What’s Next?

The CMA plans to announce another Big Tech investigation later this month. With its new rules in place, the U.K. is taking a tougher stance on maintaining competition in the digital economy.

The CMA’s investigation into Google’s search and advertising dominance is a critical step toward fostering competition and innovation in the U.K. With AI reshaping the search landscape, this probe will have significant implications for businesses, consumers, and the future of digital services.

TechCity