Meta, Facebook’s parent company, has been told to sell GIF-sharing platform Giphy by a UK competition watchdog.
The Competition and Markets Authority (CMA) said the decision was “protecting millions of social media users and promoting competition and innovation in digital advertising”.
The CMA concluded that the partnership further increased Meta’s significant market power, by limiting other platforms’ access to Giphy GIFs, driving more traffic to Meta-owned apps.
The watchdog also said at the time of the Merger, Facebook terminated Giphy’s advertising services, something it considered “particularly concerning” which removed “an important source of potential competition,” since Facebook controls nearly half of the £7 billion ad market in the UK.
Last month, the CMA also fined Facebook £50.5 million after failing to provide enough information to the regulator investigating the Giphy takeover.
“The tie-up between Facebook and Giphy has already removed a potential challenger in the display advertising market,” CMA chairman Stuart McIntosh said.
“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.
“By requiring Facebook to sell Giphy, we are protecting millions of social media users and promoting competition and innovation in digital advertising.”
A spokesperson for Meta told Sky News: “We disagree with this decision. We are reviewing the decision and considering all options, including appeal.
“Both consumers and GIPHY are better off with the support of our infrastructure, talent, and resources.
“Together, Meta and GIPHY would enhance GIPHY’s product for the millions of people, businesses, developers and API partners in the UK and around the world who use GIPHY every day, providing more choices for everyone.”