British competition regulator orders Meta to sell Giphy

In short: The United Kingdom’s Competition and Markets Authority (CMA) ordered Facebook parent Meta to ditch Giphy, a GIF search engine it acquired in mid-May for $ 315 million. According to the supervisory board, the only solution to the problem of competition for Facebook is to sell Giphy to an “approved buyer”.

In line with its initial findings in August, the CMA concluded that Facebook’s acquisition of Giphy could impede competition between various social media platforms.

In particular, the overview panel believes Facebook may prohibit or restrict other platforms from accessing Giphy GIFs to drive more traffic to its own resources, including Facebook, Instagram, and WhatsApp. The group was also concerned that Facebook might change Giphy’s terms of service to force competitors such as Twitter, TikTok or Snapchat to provide more user data in order to continue accessing the service.

Moreover, CMA said the deal “has already eliminated Giphy as a potential competitor in the display advertising market.”

The supervisory board also noted that Giphy had launched “innovative” advertising services and was considering expanding to other countries outside the US, including the UK, prior to the acquisition. When Facebook bought the service, it shut down Giphy’s ad business, eliminating potential competition.

Back in October, the CMA imposed a $ 70 million (£ 50.5 million) penalty on Facebook for refusal. cooperate with competition regulators.

Robin Koch, Meta’s director of public relations for the EU, said: Facets that at this stage they are considering all options, including the appeal. “Both consumers and Giphy will live better lives with the support of our infrastructure, talent and resources,” added Koch.

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