The U.K.’s competition watchdog said on Tuesday that Facebook owner Meta Platform must sell GIF maker Giphy to address competition concerns.
The Competition and Markets Authority said that the deal could harm social media users and UK advertisers. The CMA said:
“The independent CMA panel reviewing the merger has concluded that Facebook would be able to increase its already significant market power in relation to other social media platforms by:
- denying or limiting other platforms’ access to Giphy GIFs, driving more traffic to Facebook-owned sites – Facebook, WhatsApp and Instagram – which already account for 73% of user time spent on social media in the UK, or
- changing the terms of access by, for example, requiring TikTok, Twitter and Snapchat to provide more user data in order to access Giphy GIFs.”
“We disagree with this decision,” A Meta spokesperson said to Reuters. “We are reviewing the decision and considering all options, including appeal.”
In May 2020, Facebook had announced the acquisition of Giphy for $400 million. The company was planning to integrate the popular GIF maker with Instagram, WhatsApp and Messenger.
In March 2021, Reuters reported that the UK competition watchdog gave social media giant Facebook and Giphy 5 working days to offer proposals to address its concerns over the companies’ merger deal. In October 2021, a UK watchdog fined Facebook £50 million ($70 million USD) for deliberately withholding information related to ongoing antitrust oversight of its acquisition of Giphy.