Facebook owner Meta orders sale of GIF library Giphy in UK regulator’s ‘final decision’ | Business News

Facebook and Instagram owner Meta has been ordered by Britain’s competition watchdog to sell GIF library Giphy.

The Competition and Markets Authority (CMA) said the ruling was “final”.

The move comes after Meta’s long-running efforts to overturn CMA ruling last year The acquisition, which closed in May 2020, could hurt social media users and UK advertisers.

Meta even went to court to try to stop the ruling on legal issues, having previously been fined £50m by regulators for knowingly refusing to comply with its investigation.

The American social media giant conceded defeat on Tuesday.

A spokesman responded: “We are disappointed by the CMA’s decision but accept today’s ruling as final on this matter.

“We will be working closely with CMA to divest GIPHY.

“We thank the GIPHY team for their business during these uncertain times and wish them all the best.

Bangkok, Thailand - October 29, 2021: Yuan sign displayed on the device screen.  Meta is Facebook's new company name. The social media platform will be changed to Meta to emphasize its Metaverse vision.
New buyers of Giphy must get CMA approval

“We will continue to assess opportunities – including through acquisitions – to bring innovation and choice to more people in the UK and around the world.”

Giphy – a website for making and sharing animated images called GIFs – was acquired to integrate with Instagram.

But the CMA found the deal could allow Meta to restrict access to GIFs on other social media platforms, “making these sites less attractive to users and less competitive”.

It also found that the deal “removes Giphy from a potential challenger to the UK display advertising market, preventing UK businesses from benefiting from innovation in this market”.

It announced the final decision after a final review: “Giphy’s advertising service has the potential to compete with Meta and will encourage greater innovation by Meta and other market players.

“However, Meta terminated Giphy’s advertising services following the acquisition, removing a potential advertising tool for UK businesses.

“The CMA believes this is particularly concerning given that Meta controls nearly half of the UK’s £7bn display advertising market.”

It added that new buyers of Giphy must be approved by regulators.

Source link