What is Strategic Market Status and why now?
The UK’s competition watchdog, the Competition and Market Authority (CMA), has designated Google as holding “strategic market status” (SMS) in the realms of search and search advertising. This rare move places Google in a special regulatory category designed for firms with significant market power. In practical terms, SMS gives the CMA greater leverage to push changes to how Google operates in the UK, beyond routine competition enforcement.
The scope of the CMA’s proposal
The CMA has signalled potential interventions rather than immediate sanctions. Among the ideas on the table are:
- Choice screens that would allow UK internet users to pick alternative search services. These could include AI-powered rivals such as Perplexity and ChatGPT-based search experiences.
- Fairer ranking practices to ensure diverse and transparent results.
- Stronger controls for publishers over how their content is used, including data used to train AI or appear in AI-generated responses.
The aim, according to the CMA, is to promote competition in search and search advertising—a sector where Google commands a dominant share of UK user queries and ad impressions.
What SMS means for Google and UK users
Being designated with SMS does not imply wrongdoing on Google’s part. Instead, it acknowledges the company’s strategic position and triggers a regulatory framework that could require structural or behavioral changes. The CMA emphasises that SMS is intended to unlock competition, spur innovation, and give businesses and consumers more choice in how they search the web and how ads are delivered.
Industry reaction and potential trade-offs
Google’s response has focused on concerns about stifling innovation. An executive from Google warned that the proposed interventions could hinder UK users’ access to new products and slow the rollout of AI-powered features, at a time when AI is advancing rapidly. Critics of the CMA’s approach argue that heavy-handed regulation could dampen investment and slow the pace at which new search tools arrive in the market.
Supporters of the policy say SMS is a pragmatic step to prevent a single platform from dominating both search and advertising markets. They point to potential gains for publishers, developers, and smaller search startups that might gain traction if users can more easily switch search engines or if AI-driven results are scrutinised for fairness and accuracy.
What happens next
The CMA will open a formal consultation on the proposed changes later this year. During this period, stakeholders—ranging from consumer groups to tech firms, publishers, and advertisers—will have a chance to submit evidence and alternative ideas. The CMA has stressed that SMS is a regulatory tool, not a punitive measure, and that any mandated changes would be subject to a careful assessment before being enacted.
Context in the global tech landscape
<pThe CMA’s decision aligns with broader global concerns about the power of major platforms in digital markets. As authorities in the EU, the US, and other regions sharpen their scrutiny of dominant tech players, the UK emphasises a responsive, evidence-based approach to ensure healthy competition and innovation. For UK consumers, the outcome could be better options for search and potentially more transparency around how results are ranked and how data is used in AI systems.
What to watch
Key indicators will include: the content and structure of any proposed choice screens, the specificity of rules governing content use, and the timeline for implementing changes. Regulators will also assess how forthcoming changes impact new product development and the uptake of AI technologies in UK search services.
In the near term, users can expect the CMA to publish its consultation document and gather feedback from a broad set of stakeholders. The debate over SMS will likely influence how search engines compete in the UK long after a final framework is established.
