The competition regulator in Britain, The Competition and Markers Authority (CMA), has told Meta Platforms (newly renamed parent company of Facebook) that it has to sell animated images platform Giphy. The authority found that the acquisition of the platform could harm social media users and UK advertisers, and would reduce competition between social media platforms and in the display advertising market.
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Facebook has said that it would appeal the decision by die CMA. “We are reviewing the decision and considering all options, including appeal,” a spokesman for Meta said in a statement.
“The tie-up between Facebook and Giphy has already removed a potential challenger in the display advertising market,” said Stuart McIntosh, chair of the independent investigation on Facebook-Giphy for the CMA. “By requiring Facebook to sell Giphy, we are protecting millions of social media users and promoting competition and innovation in digital advertising,” he added.
When the sale was announced back in May 2020, Giphy told the world that they are joining Facebook as part of the Instagram team. The company was last valued at $600 million and had received about $150 million in funding since their launch.
Joining the Instagram team would appear to be the best fit for Giphy. It’s a smaller, more focused part of the Facebook empire, and of course more prominent with image sharing. Facebook has already deeply integrated Giphy into its platform. It uses Giphy’s API to provide GIFs to Facebook, Facebook Messenger, Instagram, and WhatsApp.
The CMA has been actively looking into big tech monopolies – earlier this year it said that Viagogo must sell part of Stubhub’s international business as their merger would reduce competition in the UK. Even Google has had to change tact – pledging more restrictions on its use of data from its Chrome browser to address CMA’s concerns about plans to ban third-party cookies that advertisers use to track consumers.
