UK competition regulators have asked Meta, Facebook's parent company, to sell Giphy's GIF platform. This was done after regulators found that the acquisition could distort the digital advertising market and harm social media users.
The Competition and Markets Authority (CMA) said the decision was in line with interim findings that Facebook's acquisition of Giphy in May last year would reduce competition between social media platforms and in the online advertising market.
"The loss of competition in this sector is particularly worrying given that Facebook controls almost half of the £ 7 billion display ad market in the UK," the CMA statement quoted us from Euronews as saying.
Facebook, which recently changed its parent name to Meta, said it would appeal the CMA's decision.
In 2020 Facebook bought Giphy worth USD 400 million to integrate it with the photo -sharing app, Instagram.
"The relationship between Facebook and Giphy has eliminated potential challengers in the picture advertising market," said Stuart McIntosh, head of independent investigations at Facebook-Giphy for the CMA.
"By requiring Facebook to sell Giphy, we protect millions of social media users and promote competition and innovation in digital advertising," he continued.
Responding to this, Facebook said it did not agree with the decision.
"We are reviewing the decision and considering all options, including an appeal," a Meta spokesman said in a statement.
The CMA began research on the deal in January of this year, and in April referred it to more in -depth research.
