Google Proposes Major Search Overhaul to Avoid EU Regulatory Action
In a significant move to prevent potential multibillion-dollar penalties under the European Union’s Digital Markets Act, Google has reportedly offered to fundamentally alter how it displays search results. According to exclusive reporting from our detailed coverage at IMD Supply, the tech giant is preparing substantial concessions that would level the playing field for competing services in search listings.
The EU regulatory scrutiny began in March 2025 when authorities identified what they described as systematic preference for Google’s own services in search results and restrictions preventing developers from directing users to alternative app distribution channels. This regulatory pressure follows similar challenges faced by other tech giants, as evidenced by recent corporate responses to regulatory environments across different industries.
The Core Conflict: Vertical Search Services
At the heart of the dispute lies Google’s alleged favoring of its own specialized services—such as Google Flights and Google Hotels—over what regulators term “vertical search services” (VSS). These specialized providers, including companies like Expedia and Hotels.com, focus exclusively on delivering comprehensive results within specific industries but have claimed they’re systematically disadvantaged in Google’s search rankings.
The proposed solution, detailed in documents reviewed by Reuters, represents a fundamental shift in how Google Search would operate in European markets. “We will create the opportunity for each VSS to show its own box on Search,” Google stated in its proposal. “A VSS box will be populated with results from that VSS inventory.”
Technical Implementation of the New System
Under the proposed changes, Google’s own services would appear alongside VSS boxes with identical formatting, creating visual parity that regulators have demanded. The selection of which VSS box appears in search results would be determined by what Google describes as “objective and non-discriminatory criteria,” though the specific metrics remain undisclosed.
Perhaps most importantly, the changes wouldn’t eliminate direct results from primary service providers. Results from actual airlines, hotel chains, and car rental companies would continue to appear in dedicated boxes “above or below the VSS box depending on the relevance to the user’s query.” This balanced approach reflects the kind of technological integration strategies we’re seeing across the digital landscape as companies adapt to evolving market demands.
Broader Context of EU Tech Regulation
Google’s situation mirrors the regulatory pressure that forced Apple to open its ecosystem to third-party app stores earlier this year. The Digital Markets Act has emerged as a powerful tool for EU regulators seeking to dismantle what they perceive as anti-competitive practices among dominant tech platforms. This regulatory environment is creating ripple effects across global markets, similar to how Asian markets are responding to changing global economic conditions.
The proposed changes represent Google’s willingness to modify what were once considered untouchable aspects of its core search business. As the company navigates these regulatory challenges, the tech industry is watching closely to see whether similar concessions might be required of other dominant platforms. This comes amid broader technological shifts, including significant AI platform updates that are reshaping how users interact with digital services.
Unresolved Questions and Market Implications
While Google’s proposal addresses several of the EU’s stated concerns, significant questions remain about implementation details and whether these changes will satisfy regulators. The definition of “objective and non-discriminatory criteria” for VSS selection will be particularly scrutinized, as will the practical impact on user experience and competition.
The outcome of these negotiations could have far-reaching implications for digital markets worldwide, potentially establishing new precedents for how dominant platforms must treat competitors. As we’ve seen with financial market reactions to regulatory developments, these policy decisions can create significant market volatility and strategic repositioning among major corporations.
Meanwhile, the broader context of regulatory oversight continues to evolve, with implications for public infrastructure and services, as highlighted by recent developments in public health monitoring capabilities. Google has declined to comment on the specific details of the Reuters report, leaving the tech industry and regulatory observers awaiting official confirmation of what could represent one of the most significant changes to search functionality in the company’s history.
