Your commercial news round-up: Google, Royal Mail, government borrowing, water companies

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Are you up to date on this week’s commercial news? The US Department of Justice has recommended that Google sells its Chrome web browser, following a landmark anti-competition ruling in August. Meanwhile, job cuts could be on the cards at Royal Mail, UK government borrowing has reached record highs and water companies have been prevented from using customer money to fund bonuses. Read on to find out more!

• The US Department of Justice (DOJ) has proposed that Google sells off its Chrome web browser to end its search monopoly. This is one of several remedies suggested by the DOJ to prevent Google from maintaining its dominance in online search. The government lawyers also recommended that Google be forced to stop entering into contracts with companies such as Apple and Samsung, which make its search engine the default on smartphones and browsers.
  
  These proposed remedies come after a landmark anti-competition ruling in August, which found that Google had illegally crushed its competition in online search. Several US states joined the DOJ’s argument, arguing that changes will open up the market. Government lawyers stated: "Restoring competition to the markets for general search and search text advertising as they exist today will require reactivating the competitive process that Google has long stifled.” In response, Google said that the DOJ has pushed "a radical interventionist agenda that [will] harm Americans and America’s global technology leadership”. Google is expected to present its own proposed remedies by 20 December, with a decision on the case expected to be issued by summer 2025.
   
• The owner of Royal Mail, International Distribution Services (IDS), has warned that job cuts or price rises could be in store following the recent government budget. The company’s CEO, Martin Seidenberg, stated that changes to national insurance will create £120 million in costs for the postal service. The IDS reported an adjusted operating profit of £61 million for the 26 weeks to 29 September, up from a £169 million loss last year. However, it made an £87 million loss once taking into account write-downs. Royal Mail has previously called for reforms to the universal service obligation, which requires it to make first-class deliverers six days a week. Seidenberg explained that this rise in costs “increases the need” for reform. When asked about job cuts, he said that it is “too early to say” but that he wouldn’t rule it out. He stated that the company is also considering various avenues to reduce financial strain, such as increasing automation.
   
• UK government borrowing in October was higher than expected, reaching £17.4 billion – the second highest October figure since monthly records began in 1993. The increase in borrowing was attributed to record-high debt interest payments and public sector pay rises. In addition, the Office for National Statistics (ONS) reported that interest payments on government debt reached £9.1 billion – the highest October figure since monthly records began in 1997. Figures also showed that government spending was up by £2.2 billion from the previous year, reflecting the impact of public sector pay deals. Net debt has also reached £2.7 billion, equivalent to 97.5% of the UK's Gross Domestic Product. UK economist at Capital, Alex Kerr, said that October’s “disappointing” public finances figures underline “the fiscal challenge that the chancellor still faces".
   
• Three firms – Thames Water, Yorkshire Water and Dwr Cymru Welsh Water – have been directly prevented from using customer money to pay bonuses that were collectively worth £1.6 million, according to the regulator Ofwat. The watchdog’s new powers prevent bonuses being funded from customer bills if a company fails to meet environmental or performance targets. Ofwat stated that any "undeserved" bonuses would now be covered by the owners and lenders of the companies, rather than customers.

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