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Introduction: Google required to offer UK publishers option to exclude AI search summaries, competition watchdog states

Good morning, and welcome to our rolling coverage of business, the financial markets and the world economy.

The UK competition authority has declared that online publishers and news outlets can now choose to exclude themselves from AI summaries in Google search results.

The Competition and Markets Authority has indicated these fresh guidelines will give publishers, such as news groups, greater leverage when discussing content agreements with Google.

This step follows concerns from media firms about reduced visitor traffic to their sites, impacting income, since Google introduced AI summaries atop search listings.

CMA chief executive Sarah Cardell stated:

As AI Overviews transform online search quickly, it remains vital that content creators, including news outlets, hold suitable negotiating strength regarding use of their material. These steps will simultaneously assist millions of UK search users in grasping and relying on displayed information.
Any measures in this area must adapt over time. Google has shared updates to its search operations and the rules set today align with current and upcoming Google activities. We will apply the flexible UK framework to track and tackle emerging issues, with further steps on Google search planned soon.

The updated guidelines also require Google to ensure publisher material receives proper credit through visible links within AI search outputs.

Publishers must gain the ability to prevent their content from supporting AI model refinements, granting them assurance over various AI applications of their work, according to the CMA.

The agenda

9am BST: Eurozone services PMI
9.30am BST: UK services PMI
3pm BST: US services PMI
Today: St Petersburg International Economic Forum
Today: FTSE reshuffle to be announced after market close

Key events

21m agoOECD forecasts series of global downturns if Iran tensions extend to 2027
40m agoEuropean equity markets begin session weaker
45m agoOvo settles with Ofgem for 11.4m pounds regarding prepayment meters
1h agoThree quarters of employees lack sufficient retirement savings for moderate income, sector alerts
2h agoGoogle to launch tests of revised search features for select UK site owners today
2h agoGoogle allotted nine months for search modifications, regulator confirms
2h agoIntroduction: Google required to offer UK publishers option to exclude AI search summaries, competition watchdog states

OECD forecasts series of global downturns if Iran tensions extend to 2027

Elsewhere this morning, the Organisation for Economic Co-operation and Development cautioned that extended Middle East conflict into next year would severely affect worldwide expansion, triggering recessions in select economies and energy shortfalls.

In its recent Economic Outlook, the Paris-based group of developed nations outlines a prolonged disruption case with no US-Iran accord until 2027.

Such conditions would cut global GDP expansion to 2.1 percent this year from 3.4 percent in 2025, pushing certain economies toward or into recession, with developing markets affected most.

Read the complete account here by Heather Stewart:

Although sentiment on the FTSE remains subdued this morning, shares in B and M European Value Retail have surged 16 percent despite the retailer posting a 38 percent pre-tax profit decline to 284 million pounds.

Investors anticipated the drop and now focus on progress with the turnaround strategy.

Susannah Streeter from Wealth Club notes:

UK like-for-like sales showed slight growth in the final quarter and leadership indicated the Back to B and M Basics initiative shows initial results. Hopes exist that B and M has passed its weakest phase, with product updates, cost discipline and retail park sites supporting further gains.

European equity markets begin session weaker

European equity markets opened mostly lower this morning, with the UK FTSE 100 index falling 0.5 percent. The German Dax declined 0.8 percent and the French Cac 40 dropped 0.43 percent.

The Stoxx Europe 600, covering major listed firms across the continent, eased 0.4 percent.

Ovo settles with Ofgem for 11.4 million pounds regarding prepayment meters

Ovo Energy has agreed to pay over 10 million pounds after the energy regulator determined vulnerable customers faced harm risk from inadequate oversight of prepayment meter households.

Ovo consented to a settlement with a 7 million pound contribution to Ofgem voluntary redress fund and a 3.4 million pound package of credit and debt relief for select vulnerable customers, viewed by the regulator as compensation substitute.

Cathryn Scott, director of market oversight and enforcement at Ofgem, remarked:

OVO clearly underperformed in supporting vulnerable PPM customers, making their process improvements appropriate. Our probe ensures vulnerable customers receive debt relief or credits plus a redress fund payment.
Prepayment meters suit many users for energy control with high satisfaction, yet they do not fit all and robust monitoring protects at-risk consumers.
This probe supports Ofgem efforts to elevate energy market standards and consumer safeguards, urging suppliers to assist those in difficulty more effectively.
Anyone concerned about bill payments should contact their supplier promptly to explore available support options suited to their situation.

In January the regulator also required Ovo to pay a 2.7 million pound penalty for failing to deliver government winter bill support to thousands of vulnerable customers amid the energy price crisis.

A single-person household may require up to half a million pounds to sustain a moderate retirement lifestyle, sector estimates indicate.

An illustrative table from Pensions UK outlines annual private income or pension savings needed for each retirement living standard. It assumes conversion of a defined contribution pension into an annuity providing guaranteed lifetime income.

These projections presume full state pension receipt and no rent or mortgage obligations. They rely on current UK tax limits and annuity rates around 5,000 to 7,500 pounds per 100,000 pounds of pension savings.

Three quarters of employees lack sufficient retirement savings for moderate income, sector alerts

Elsewhere this morning, the pensions sector warned roughly 75 percent of workers fail to save adequately for moderate retirement income, exposing many to sharp income reduction upon leaving work.

Pensions UK reported only 23 percent of the workforce heads toward a moderate lifestyle requiring 32,700 pounds yearly for one person and 45,500 pounds for two.

A minimum retirement lifestyle costs 13,900 pounds annually for one person and 22,500 pounds for two, while comfortable living requires 45,400 pounds and 62,700 pounds respectively.

The amounts cover routine expenses including food, household bills, transport plus social and leisure activities. 82 percent are projected to reach the minimum level.

All three tiers assume full state pension and absence of rent or mortgage costs.

Zoe Alexander, executive director of policy and advocacy at Pensions UK, commented:

The updated retirement living standards highlight a clear fact for many: current savings rates will not deliver expected retirement outcomes.
Without intervention, too many face a sudden income drop after stopping work.

Ms Alexander added: We also urge individuals to consult employers about options for saving beyond minimums, such as enhanced matching pension contributions.

Google to launch tests of revised search features for select UK site owners today

Google announced immediate trials of new adjustments enabling a subset of UK website owners to control how their links and content feature in generative AI search tools.

Mrinalini Loew, general manager at Google Search Ecosystem, noted in a blog post today:

We continue listening to publisher and creator input while working with regulators including the UK Competition and Markets Authority to equip website owners with suitable tools as user habits shift. Today we begin testing a new control allowing website owners to manage link and content display in generative AI Search features.

A fresh tool will let website owners choose whether their site appears and supports grounding of responses in Google AI search elements such as AI overviews and AI mode.

The control will not influence ranking for non-generative AI search results, Loew stated.

We also introduce new Search Console insights for website owners on page visibility in generative AI Search features. These cover impression data and details on pages appearing in AI responses plus countries involved. We keep collaborating with website owners on useful insights to guide strategies and will add further metrics over time.
We start rolling these features to a subset of UK website owners for thorough testing ahead of global expansion. As AI creates fresh discovery chances we will refine experiences to aid web exploration and develop tools helping sites connect better with audiences.

Google allotted nine months for search modifications, regulator confirms

Google has nine months to enact all mandated adjustments to its search services, the competition regulator stated.

However the CMA expects key control elements to reach publishers well ahead of that deadline.

The regulator has requested Google submit and publish compliance reports detailing changes and adherence. These reports are required every six months initially, after which the CMA will reassess reporting frequency.

Google is not alone under CMA scrutiny, as the regulator has opened strategic market status probes into Apple and Microsoft as well.

The guidelines announced today follow the CMA decision last year to assign Google strategic market status in general search services, signifying the firm holds sufficient market influence to warrant a dedicated regulatory approach.

The watchdog can mandate operational changes for Google in those domains under new digital legislation.

Many news media organisations and web publishers will welcome this development, anticipating improved leverage for compensation when content appears in Google AI mode.

Cardell also noted this morning that Google compliance will face active monitoring and the regulator plans further announcements on Google search operations in coming weeks.