Competition watchdog the ACCC says Google’s new AI search has so far had “limited”impact.’
Google last month started rolling out its AI search, feared by some publishers as a referral traffic killer, in Australia.
AI Overviews use generative AI to create a snapshot about a topic or question, along with key information and links to dig deeper.
The ACCC’s ninth Digital Platform Services Inquiry report has been published.
“We are at a critical inflection point where generative AI tools are enabling technological innovations across a range of digital platform services,” ACCC commissioner Peter Crone said.
“In general search, we are seeing Google Search, Microsoft Bing and new entrants launching or integrating AI-powered search features.
“While it is too early to say with certainty, with use of AI constantly developing, the impact of generative AI on market dynamics in general search appears limited so far.”
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.
The report also observes that Google and Microsoft are well placed to leverage generative AI into their search offerings given their significant presence across the generative AI supply chain, including through commercial partnerships.
“It is important that consumers find information and answers they need quickly, however, search quality is difficult to measure because it means different things to different people,” Crone said.
“This report contributes to the ongoing discussion on search quality by examining a number of elements, including the prominence of ads, optimisation of webpages to improve their ranking by search engine algorithms, personalisation and diversity of results.”
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.
This is a trend which some consumers may perceive as lowering search quality, at least for some types of search queries.
The report also looks at the apparent increase of AI-generated material on the quality of search results.
“The possible proliferation of AI-generated content is another lens to look at search quality,” Crone said.
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.”
Google is being challenged across the world.
In August this year, a US District Court ruled in favour of the US Department of Justice that Google had illegally maintained its monopoly in search and search advertising through its exclusive distribution agreements.
In the EU, mandatory choice screens have been introduced, as well as measures aiming to address self-preferencing, under the Digital Markets Act. The UK is also in the process of introducing a new competition regime for digital platforms.
“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,” Crone said.
The ACCC’s Digital Platforms Branch is conducting a five-year inquiry into markets for the supply of digital platform services in Australia and their impacts on competition and consumers, following a direction from the Treasurer in 2020.
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