Meta ordered to sell GIPHY for the second time by UK antitrust watchdog

Meta, more colloquially known as Facebook has been ordered by the UKantitrust watchdogCompetition and Markets Authority (CMA) to sell GIPHY Inc. This is the second instance when Meta has been ordered to sell the popular gif library.

Meta conceded the defeat and said it was disappointed by the decision.

“We are disappointed by the CMA’s decision but accept today’s ruling as the final word on the matter.We are grateful to the Giphy team during this uncertain time for their business, and wish them every success,” said a Meta spokesperson.

Meanwhile,Stuart McIntosh, chair of the independent inquiry into the buyout 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.”

As reported by WION, the watchdog, in November last year issued the first order to Meta citing the deal could harm the competitors. Reportedly, Meta bought GIPHY in 2020 for an estimated $400 million to integrate it with its other platforms viz. Instagram and WhatsApp.

However, CMA feared that the deal could limit other social media platforms' access to GIFs, which, in turn, would have made those sites less attractive to users.

"Without action, it will also allow Facebook to increase its significant market power in social media even further, through controlling competitors' access to Giphy GIFs," said Stuart McIntosh, who headed an inquiry into the buyout.

However, after the order, Meta decided to appeal the decision and went toCompetition Appeal Tribunal in January, earlier this year.

(With inputs from agencies)

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