We have launched a new capability in AdSense allowing Google-certified ad networks compete directly within AdSense, which means that advertisers from these third-party networks will be able to compete with AdWords advertisers to show on the Google Content Network.
These new capabilities will automatically be enabled for your account, and you'll see a new section in your Ad Review Center where you can allow or block specific ad networks or all networks except AdWords. Please note that we'll gradually be adding new ad networks to AdSense accounts over the next few months, so you won't see any immediate impact on your ads or your earnings.
To ensure the quality of the ads that appear on AdSense publisher websites, Google will certify all participating ad networks for adherence to our standards for user privacy, ad quality, and speed. Some participating ad networks use targeting methods similar to Google's interest-based advertising to show more relevant ads to users on the sites they visit. These ad networks won't be permitted to collect data from your site for the purpose of subsequent interest-based advertising, but we'll allow networks that comply with user privacy guidelines to show ads using these tools. Publishers can opt out of user interest targeting from these ad networks, and Google has changed our requirements for third-party ad serving to reflect this.
We are currently only accepting ads from Google-certified ad networks in North America and Europe, but we will make this feature available to ad networks in additional parts of the world in the future.In my opinion, Google doesn't have a monopoly on search. Sure, it has an enormous market share, which is growing, but there are other major players, and there's no lock-in for search. On the other hand, Google may very well have a monopoly on advertising in Adwords, and advertisers regularly claim that prices for keywords are much more expensive on Adwords than on other networks owing to the auction process.
Yet, despite making virtually all of its money off of this product, Google plans to open it up to competition. As far as I know, no government forced GOOG's hand. There was no mandate from the EU.
Google's leaders say that they believe the company can out-compete others in the industry, and their actions follow these statements. I believe that Google may actually believe them.
They're not evil (yet). Here's the Google blog.