The Competition and Markets Authority has found that Meta Platform Inc’s META takeover of Giphy could allow Meta to limit other social media platforms’ access to GIFs, making those sites less attractive to users and less competitive.
It also found that the deal has removed Giphy as a potential challenger in the U.K. display advertising market, preventing U.K. businesses from benefiting from innovation in this market.
The CMA ordered Meta to sell Giphy in November 2021, finding that the deal could harm social media users and U.K. advertisers. Meta subsequently appealed that decision to the Competition Appeal Tribunal. In July 2022, the CAT upheld the CMA’s decision.
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The CMA found that Giphy’s advertising services had the potential to compete with those of Meta and would have encouraged more incredible innovation from Meta and other market players.
However, Meta terminated Giphy’s advertising services upon acquisition, removing a potential ad tool for U.K. businesses. The CMA has concluded that the only way to avoid the deal’s repercussions would be by selling it off to an approved buyer.
In September, Facebook suffered a setback in its European Union court challenge of a German antitrust decision that demanded an overhaul of the social media giant’s business model. Competition authorities probed Meta over alleged abuses of a dominant position.
Price Action: META shares traded higher by 1.04% at $135.43 on the last check Tuesday.
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