The U.K.'s Competition and Markets Authority (CMA) on Friday officially designated Alphabet's Google with 'strategic market status' due to its 'substantial and entrenched market power' in online search and search advertising. This designation, the first under the U.K.'s new digital competition regime, allows the regulator to investigate and impose 'proportionate, targeted interventions' to foster more effective competition. The CMA noted that over 90% of searches in the UK are conducted on Google's platform. While the designation itself is not a finding of wrongdoing, it opens the door for new rules governing Google's operations. The scope of the designation includes AI-based search features like AI Overviews, but not the Gemini AI assistant at this time, a position the CMA will keep under review. In response, Google's Senior Director for Competition, Oliver Bethell, expressed concerns that some potential interventions could 'inhibit UK innovation and growth'. Following the announcement, Class C shares in Alphabet were reported to be 0.2% lower in pre-market trading in New York.