The United Kingdom’s Competition and Markets Authority (CMA) on Friday formally designated Google as having a “strategic market status” (SMS) in online search and search advertising — a powerful classification that could subject the tech giant to new, stricter regulations designed to promote fair competition.
The designation, the first of its kind under Britain’s new digital markets regime that came into force in January, gives the CMA enhanced powers to impose binding conduct requirements on companies deemed to have entrenched market dominance in strategically important digital sectors.
“Google has had an unparalleled position in this digital activity for an extended period,” the CMA wrote in its decision. “Other traditional general search providers are significantly smaller than Google and have been for many years. Bing is the largest of these providers, but its current shares of queries and search advertising are both less than 5%. No traditional general search providers have materially grown relative to Google for at least fifteen years.”
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While the designation itself does not immediately impose obligations on Google or suggest wrongdoing, it lays the groundwork for future interventions that could reshape how the company operates its search and advertising services in the U.K.
What the CMA’s Designation Covers
The CMA’s ruling applies to Google’s core search services, its online search advertising, and AI-enabled features such as AI Overviews and AI Mode — newer tools that use artificial intelligence to generate search summaries and contextual answers. It also covers the Discover feed, “Top Stories,” and News tabs that appear within Google Search.
However, the CMA clarified that the Google News app and website, as well as search syndication services, remain outside the designation’s scope. The regulator also said it will continue monitoring developments around Google’s Gemini AI assistant, hinting that it could fall under future scrutiny as the AI search market evolves.
The CMA now plans to open consultations later this year to determine what specific rules or obligations to impose on Google. Potential measures could include:
- Requiring users to easily choose and switch default search engines via “choice screens.”
- Enforcing stronger data portability rules to prevent user lock-in.
- Mandating fairer ranking and attribution practices to ensure third-party content and publishers are not disadvantaged.
- Requiring explicit user consent for the use of data in AI-generated search results.
A Move Years in the Making
The decision follows a nine-month investigation launched in early 2025 after the new competition regime came into force. The probe examined whether Google’s dominance in online search was limiting innovation, creating barriers to entry for rivals, or giving the company undue leverage over the advertising ecosystem.
Google controls over 90% of the U.K. search market — a figure that has remained largely unchanged for more than a decade — giving it unmatched access to user data and advertising revenues. Regulators across Europe have long argued that this dominance allows Google to unfairly prioritize its own services in search results while making it difficult for competitors to gain traction.
Google Pushes Back
In a blog post responding to the CMA’s announcement, Google warned that excessive restrictions could harm innovation in the U.K.
“The UK enjoys access to the latest products and services before other countries because it has so far avoided costly restrictions on popular services such as Search,” the company wrote.
“Retaining this position means avoiding unduly onerous regulations and learning from the negative results seen in other jurisdictions, which have cost businesses an estimated €114 billion,” it added, referring to the economic cost of regulatory fragmentation across the European Union.
Google further argued that some proposed interventions could slow the rollout of new AI-driven features and raise costs for businesses that rely on its advertising platform.
“Many of the ideas for interventions would inhibit U.K. innovation and growth, potentially slowing product launches at a time of profound AI-based innovation. Others pose direct harm to businesses, with some warning they may be forced to raise prices for customers,” the company said.
The CMA’s action underscores the U.K.’s determination to take a more assertive role in policing the dominance of Big Tech platforms. Under the new regulatory framework, companies designated with “strategic market status” can face legally binding rules requiring them to operate in ways that promote competition and transparency — with fines of up to 10% of global turnover for violations.
Analysts say that while Google’s designation is expected to be the first of several, it also signals the growing tension between innovation and oversight in the digital economy. With AI now reshaping how users interact with search results, regulators are increasingly concerned that the same monopolistic forces that shaped the web era could dominate the AI era as well.
The CMA said it will continue to engage with Google and other stakeholders before introducing formal remedies. But for now, the move marks a historic moment — one that positions the U.K. at the forefront of global efforts to rein in the power of Silicon Valley’s biggest players without stifling technological advancement.