MADRID, 18 Oct. (EUROPA PRESS) -
The UK Competition and Markets Authority (CMA) has finally required Meta, Facebook's parent company, to sell Giphy, after concluding that the acquisition of this company by the multinational led by Mark Zuckerberg could harm users of social networks and advertisers in the British country.
"The CMA concluded that the only way to avoid the significant impact that the agreement would have on competition is for Giphy to be sold in its entirety to an approved buyer," the British regulator announced, thus confirming its November 2021 decision, after the appeal process by the American multinational.
In this regard, it recalls that the Competition Appeal Court (CAT) consolidated last July the CMA's decision in 5 of the 6 contested reasons, while it only ruled in favor of Meta for a procedural reason related to the exchange of confidential third-party information, after which the CMA has carried out an accelerated review, issuing its final decision on Tuesday.
During the procedure, the regulator found that Giphy's advertising services had the potential to compete with Meta's and would have encouraged further innovation by this company and other market players.
However, it points out that Meta terminated Giphy's advertising services after the acquisition, thus removing a potential advertising tool for UK businesses, which it says is particularly worrying given that Meta controls almost half of the advertising market. in the United Kingdom, valued at around 7,000 million pounds (8,091 million euros).
"This deal would significantly reduce competition in 2 markets," said Stuart McIntosh, chairman of the independent research group, as it has resulted in the elimination of a potential competitor in the UK display ad market while giving Meta the ability to further increase your market power on social media.
"The only way to address this is by selling Giphy," he said, noting that Giphy's move will promote innovation in digital advertising and also ensure that UK social media users continue to benefit from access to Giphy.
In May 2020, Facebook reported the purchase of the platform for creating and sharing animated images (GIF) Giphy for more than 300 million dollars (309 million euros) with the aim of incorporating it into its Instagram social network.
A month later, the CMA decided to open an investigation into the acquisition due to the potential adverse effect it could have on competition, which in January 2021 became an in-depth examination, which in November last year led to the decision of the regular to demand the sale of Giphy, appealed by Meta.
