Britain’s competition watchdog had the authority to order Meta in the past year to rescind the deal after a year after the announcement however, Meta appealed to an appeals tribunal that rejected the majority of the company’s arguments. After further review of the case, the Competition and Markets Authority concluded that “the only way to avoid the significant impact the deal would have on competition” is to require Meta in the future to transfer Giphy to a buyer that has been approved.
“We are dissatisfied with the CMA’s decision, but we believe that today’s decision is the final word on the issue. We will be working closely with the CMA in the process of divesting GIPHY,” Meta said in an announcement. “We will be looking at new opportunities whether through acquisitions or otherwise provide innovation and choices to more people throughout the UK as well as around the world.”
Giphy, a New York-based company, has a library of video loops that are short, known as GIFs are a very well-known tool for Internet users making posts or sending messages to social networks.
Meta stated that it will wait for more details about the divestment orders and won’t submit a new appeal and putting an end to the long-running dispute over the purchase reportedly valued at $400 million.
The first time that the U.K. watchdog had sought to rescind a tech deal was a precursor to increased scrutiny. Earlier this year, the CMA began investigations about the dominance of Amazon in the market and Microsoft’s acquisition of the maker of videogames Activision Blizzard.
The watchdog’s first in-depth inquiry revealed that Facebook’s purchase of Giphy could affect social media users and advertisers by restricting the competition for animated images.
After analyzing its decision, the watchdog concluded on Tuesday that the deal will increase traffic to Meta-owned sites but also limit access for platforms that are online to Giphy GIFs. The watchdog also concluded that the agreement would eliminate any competition that could be posed by the U.K.’s 7 billion pounds ($7.9 billion) display advertising market, a quarter of which Facebook is the sole owner.
Hi there, I’m Shakti Makvana. I like to write blogs on Entertainment, Sports, News and Technologies. Thanks for being here today!