The simplest solution here would be to break up Google by disconnecting unrelated products. For example, YouTube could easily be spun into its own successful company. I hope though that the government takes the longer, more difficult road and tries to split Google's search product up (or at least regulates it like a utility).
There are a couple of big problems with Google's search currently. It has gotten effectively worse as their fuzzy matching technology focuses on matching the search phrase to popular results rather than the closest match. There are indications that this will get even worse in the future as Google has recently said that they are going to start discarding websites from their search options. I'm not sure what they mean by this but it's easy to imagine a situation where Google simply doesn't return results on unpopular websites.
Thus the opportunity is here to split Google into a variety of search engines and let each one tackle search in different ways. Ideally this would be done by opening up Google's massive indexing engines to their competitors and allowing pretty much anyone throw together a rival search engine that was able to run its own algorithms against pre-collected data. In principal this could create a very exciting field where consumers could choose specialized search engines (technical, celebrity gossip, world events, etc) for their particular query.
Now there are a couple of complications to this approach. The first is that Google would probably also need to open up their advertising engine to their competitors as well and allow the reselling of ad space. It is unrealistic to expect anyone to meaningfully compete against Google's adwords system - advertisers would certainly prefer to just buy ad space in a single market. Another major issue would be managing SEO, scammers, and hackers. Currently Google does an ok job here in that they generally return reputable websites for their searches. In order for the competitors to be able to offer an equivalent search experience, Google would definitely have to collaborate with the other search sites, even though the result could easily be a central authority that decides whether websites are legitimate or not.
My view here is that search really has become too important to be left in the hands of a single unregulated entity. It would be extremely difficult to regulate search in a meaningful way but doing so has the potential to really improve the online community in the long term. I hope that the powers-that-be take a serious look at this direction.