Strategic Market Status Designation
The UK‘s Competition and Markets Authority (CMA) has formally designated Google with strategic market status under the country’s new digital markets competition regime. This significant regulatory decision, which took effect on January 1, 2025, recognizes Google’s “substantial and entrenched market power” in general search and search advertising services.
What Strategic Market Status Means
This designation doesn’t automatically imply wrongdoing by Google, but it empowers the CMA to implement interventions ensuring search services remain open to effective competition. The regulator aims to protect UK consumers and businesses from potentially unfair practices by major technology firms while promoting healthy market competition.
As reported by industry sources, the CMA initiated its investigation into Google’s search industry standing on January 14 to confirm the company’s market position. The designation specifically applies to Google’s AI Overviews and AI Mode features, though notably excludes the Gemini AI assistant from current regulatory scrutiny.
Market Dominance Concerns
Will Hayter, Executive Director for Digital Markets at the CMA, emphasized the company’s market position, stating: “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.”
Regulatory Timeline and Industry Response
The CMA plans to begin consulting on potential interventions later this year. Google has expressed concerns about the regulatory direction, warning that some proposed measures could “inhibit UK innovation and growth” and potentially delay product launches during a critical period of AI advancement.
The company argues that maintaining the UK’s competitive advantage requires avoiding overly burdensome regulations, pointing to estimated costs of €114 billion to businesses in other jurisdictions that implemented similar measures. This reference clearly alludes to the European Union’s Digital Markets Act, which designated Google as a gatekeeper in 2023.
Looking Ahead
As this regulatory process unfolds, businesses and consumers can expect Google Search to face new operational rules and requirements in the UK market. The outcome will likely set important precedents for how major digital platforms are regulated in the rapidly evolving technology landscape.
