Facebook: Meta ordered Giphy sale by UK antitrust authority
The UK Markets and Competition Authority said on Tuesday that Meta’s control of the popular search engine for GIFs – short, repetitive videos and animations – would reduce competition between media platforms. society and has eliminated a potential competitor in the advertising market.
In the initial announcement of the deal, Facebook vowed to grant the same third parties access to Giphy’s content as before. However, less than a month after the acquisition was announced, the CMA said it was looking into the matter.
“After consulting with interested businesses and organizations – and evaluating the alternatives … offered by Facebook – the CMA has concluded that their competitive concerns may only be possible resolved by Facebook selling all of Giphy to an approved buyer,” the CMA said in the statement.
The tech company said on Tuesday that it disagreed with the CMA and was considering “all options, including an appeal.”
A Meta spokesperson said: “Both consumers and Giphy will get better with the support of our infrastructure, talent and resources. “Together, Meta and Giphy will enhance Giphy’s products for the millions of people, businesses, developers and API partners in the UK and around the world who use Giphy every day, providing a wide range of choices. more for everyone.”
While a far cry from the biggest deal Meta has ever made, the Giphy acquisition is the company’s first high-profile acquisition not tied to government officials.
The discovery is a blow to Meta’s aspirations amid intense antitrust scrutiny by governments around the world and a potential red flag for other Big Tech companies to pursue an acquisition. in this legal environment.
The CMA said in August that Giphy planned to expand its burgeoning advertising business into the UK before it was acquired, a move that could give UK brands a new way to promote yourself and create a direct competitor to Facebook in the advertising market. .
“However, Facebook terminated Giphy’s paid advertising partnership following the deal, meaning that an important source of potential competition was lost,” the CMA said in a blog post.
– Rob North, Brian Fung and Kaya Yurieff contributed to this article.