Meta ordered to sell Giphy after a UK watchdog ruling.
The Competition and Markets Authority upheld their November ruling that ordered the parent company of Facebook, Instagram and WhatsApp to sell the gif-creation site as it hindered “competition” and choice for social media users.
The move marks a first time the British regulators have stopped a deal by a Silicon Valley giant, who bought the market leader in gifs to social media platforms – such as TikTok, Snapchat and Twitter – after they purchased it for £290 million (more than R59 billion) in 2020.
Stuart McIntosh, who chaired the independent inquiry that conducted the remittal investigation, said: “This deal would significantly reduce competition in two markets.
“It has already resulted in the removal of a potential challenger in the UK display ad market, while also giving Meta the ability to further increase its substantial market power in social media.
“The only way this can be addressed is by the sale of Giphy.
“This will promote innovation in digital advertising, and also ensure UK social media users continue to benefit from access to Giphy.”
Meta- who appealed the decision last year arguing they would “protect millions of social media users” – admitted to be “disappointed” by the ruling but would respect it.
A spokesperson for the Mark Zuckerberg-founded company said: “We are disappointed by the CMA’s decision but accept today’s ruling as the final word on the matter.
“We will work closely with the CMA on divesting Giphy.
“We are grateful to the Giphy team during this uncertain time for their business, and wish them every success.
“We will continue to evaluate opportunities – including through acquisition – to bring innovation and choice to more people in the UK and around the world.”
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