As rumored, the UK’s Competition and Markets Authority (CMA) has ordered Meta (Facebook) to sell Giphy, saying the deal “could harm social media users and UK advertisers.” It found that the deal would boost Meta’s already prodigious market power by limiting other platforms’ access to Giphy GIFs, “driving more traffic to Facebook owned sites — Facebook, WhatsApp and Instagram.”
The CMA said that Meta’s sites dominated social media user time to the tune of 73 percent and that it could further muscle out rivals like TikTok, Twitter and Snapchat by leveraging Giphy. It added that prior to the merger, Giphy launched “innovative advertising services” used by brands like Dunkin’ Donuts and Pepsi that it could have brought to the UK.
“Facebook terminated Giphy’s advertising services at the time of the merger, removing an important source of potential competition,” the regulator wrote. “The CMA considers this particularly concerning given that Facebook controls nearly half of the £7 billion display advertising market in the UK.”