Google has already been found to have illegally monopolised the search market by international courts, but has thus far not been subjected to the same level of scrutiny in Australia.
Now, the Australian Competition and Consumer Commission (ACCC) has found that the company’s dominance in general search services in Oz has continued despite regulatory and technological changes to search services.
The ACCC says that Google has maintained its dominant position with a search engine market share of nearly 94 per cent as recently as August 2024.
In comparison, its nearest rival, Bing, has just 4.7 per cent of the Australian market.
The ACCC added that Google also continues to be the default search engine on the majority of browsers due to its commercial pre-installation and default arrangements with third parties and its ownership of the Chrome browser.
Back in July, following an intervention by the ACCC, two major telecom companies – Telstra and Optus – agreed to no longer have exclusive agreements with Google Search to have the service pre-installed as the default search engine on Android devices that they sell.
Generative AI In General Search
“In general search, we are seeing Google Search, Microsoft Bing and new entrants launching or integrating AI-powered search features,” said Peter Crone, the ACCC Commissioner.
“While it is too early to say with certainty, with the use of AI constantly developing, the impact of generative AI on market dynamics in general search appears limited so far.”
The findings were part of the ACCC’s ninth Digital Platform Services Inquiry report, which revisits and reconsiders general search.
The report notes that while the integration of generative AI into search is still evolving, Google’s competitors, including Microsoft Bing, are yet to gain meaningful market share from Google.
Search quality
The report also considered factors such as the prominence of ads, optimisation of webpages to improve their ranking by search engine algorithms, personalisation and diversity of results, when considering the quality of search engine results in the country.
For example, the report considers that search providers dependent on advertising for revenue appear to have incentives to change their search interfaces over time in ways that have made ads more prominent and less distinguishable from non-sponsored content.
The ACCC said that this is a trend which some consumers may perceive as lowering search quality.
It also looked at the apparent increase of AI-generated material on the quality of search results. “While some consumers may find the generative AI search experience more useful and efficient, others may be concerned about the accuracy and reliability of AI-generated responses to search queries,” said Crone.
Just last week, a senate select committee inquiry crisiticised Amazon, Google and Meta for training their AI models using Oz user’s data. Labor senator Tony Sheldon, the inquiry’s chair, said the companies were “exploiting Australians’ data, culture, and creativity while dodging accountability.”
Evolving regulatory mechanisms
Crone noted that the latest report comes at a time when there is increased scrutiny on general search internationally. He cited the US court rulings that Google had illegally maintained its monopoly in search and search advertising through its exclusive distribution agreements.
He also noted that in the EU, mandatory choice screens were introduced, as well as measures aiming to address self-preferencing, under the Digital Markets Act.
“As the Australian Government is currently consulting on regulatory reform measures proposed by the ACCC in the fifth DPSI interim report, it is important for us to closely monitor overseas developments while we consider reforms in Australia,” noted Crone.
While regulators are yet to firm up the new rules for big tech companies to abide by in Australia, Oz law firm Maurice Blackburn confirmed last month that it is investigating a class action against Google for alleged anti-competitive conduct in the display digital advertising market in the country. Maurice Blackburn’s investigations in Oz relate to Google providing AdTech services to both advertisers and publishers of ads, which it therefore alleges lends the company a dominant position at all points of the AdTech supply chain.
