Lawful disruption: Digital markets investigation and the future of general search and search advertising services

On 1 January 2025, a new regime for regulating digital markets in the UK came into force. Introduced under the Digital Markets, Competition and Consumers Act (DMCCA), the digital markets regime is aimed at regulating the conduct of the biggest tech platforms in relation to their specific digital activities linked to the UK. In its first investigation under the new regime, the Competition and Markets Authority (CMA) is investigating whether and, if so, how to regulate Google's general search and search advertising services.  

Given the significance of search advertising as a revenue stream for the media sector, it is important that media companies understand what the investigation could mean for their businesses.  

In this briefing, we summarise the digital markets regime and the investigation, discuss how the investigation could impact media companies and outline what steps media companies (including small ones) should take to manage compliance risks and seize opportunities to grow in the new regulatory environment.  

Overview of the digital markets regime 

Under the digital markets regime, the CMA has the power to designate firms with “substantial and entrenched market power” and “a position of strategic significance” in relation to a specific digital activity linked to the UK, as having Strategic Market Status (SMS). SMS firms will be required to comply with a range of additional regulatory obligations relating to how they conduct themselves in relation to the specific digital activities for which they have been designated. This includes bespoke Conduct Requirements (CRs), which will focus on ensuring fair trading, open choices and/or trust and transparency, and targeted Pro-Competition Interventions (PCIs) to remedy adverse effects on competition.  

The CMA has a broad range of powers to enforce compliance with the new regime, including the imposition of substantial fines on SMS firms, other businesses and even individuals.

Investigation into Google’s general search and search advertising services

On 14 January 2025, the CMA launched an investigation into whether to designate Google as having SMS in respect of its provision of general search and search advertising services. The same day, the CMA published an invitation for comments on the scope of its investigation, the issues on which it should focus and potential interventions.  

The invitation to comment closed on 3 February 2025, but there will be many more opportunities for interested parties to engage with the CMA as the investigation progresses.  

How might the investigation benefit media companies?

It seems highly likely that Google will be designated an SMS firm in respect of the provision of general search and search advertising services. If it is, then the CMA will go on to consider what CRs it may impose. This could significantly benefit media companies in several ways:

• for competitors, CRs on Google may create a more level playing field, which may enable (even small) media companies to compete with Google for search and search advertising on more equal terms
• for customers of Google’s search and search advertising services, measures to ensure fair competition could make it easier for media companies of all sizes to gain visibility in search results, attract more traffic to their websites and grow their audiences
• the CMA could require Google to share more data with advertisers and publishers, in which case media companies could obtain better insights into consumer behaviour and improve their ability to target their advertisements more effectively, and
• a requirement for Google to operate with greater transparency in terms of how it operates its search advertising services could help media companies understand the factors that influence the placement and performance of their advertisements. 

What steps should media companies be taking in response to the investigation?

The investigation represents an invaluable opportunity to input into how Google may be regulated going forward in relation to its general search and search advertising services. It will therefore be important for media companies to:

• understand the scope of the investigation, the potential issues and the interventions being considered by the CMA
• review how Google’s general search and search advertising practices impact their businesses (such as in terms of advertising costs and visibility in search results)
• develop a clear strategy in relation to the investigation and engagement with the CMA, and ensure that all messaging is consistent with that strategy
• consider proactively engaging with the CMA as the investigation progresses
• seek advice from a competition lawyer on responses to any formal information requests, and
• stay up to date on CMA activity in relation to the investigation (and the implementation of the digital markets regime more broadly).

Key takeaways

All media companies that use the general search and search advertising services of Google have an interest in this investigation.  

The investigation and likely designation of Google as an SMS firm in respect of the provision of general search and search advertising services could hugely impact the ways in which media companies of all sizes reach their audiences and improve their advertising strategies.
At this stage in the process, media companies should be keeping a watching brief on CMA activity in relation to the investigation, and considering how it may impact their specific business practices.

Preparing a plan for engagement with the CMA now could help media companies make the most of the opportunities for growth that could follow.

What's next?

In the next part of our Lawful Disruption series we will explore how changes in regulatory approach are likely to disrupt personalised or behavioural advertising and how businesses are already taking steps to adapt in order to maintain ad revenue streams.

We are also monitoring the implications of the ongoing consultation under the DMCC in relation to whether consumers must waive their statutory cooling off rights before buying digital content. Read more here: Proposed changes to the digital content waiver for subscription contracts under the DMCCA.

Further reading

If you want to read more widely on the new digital markets regime under the DMCC please see our previous briefings:

New year, new competition rules for digital markets in the UK from Mills & Reeve

CMA announces initial plans for implementing the new digital markets competition regime

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