The regulator had ordered this sale for the first time last year. Meta, which lost its appeal, agrees to part ways with the company.
The UK Competition Authority (CMA) again ordered Meta on Tuesday to sell animated illustration company Giphy, after an appeal by Facebook’s parent company failed.
Founded in 2013 and based in New York, Giphy is one of the leading gif sharing platforms, claiming over 700 million daily users.
Almost a year after an initial decision by the CMA and then an appeal by Meta before a British court which ruled in favor of the regulator, the latter again believes that “the only way to avoid a major impactof the takeover of Giphy by the social networking giant on the competition is “totally sell” the society. The markets endangered by this takeover are, according to the CMA, the UK online advertising market and the social media market.
Meta said that, in line with the regulator’s request, it would put the acquired business up for sale in 2020 for $400 million. “We will work closely with the CMA on this sale.“said a spokesperson.“ We are grateful to the team at Giphy during this uncertain time for their business, and wish them much success. We will continue to assess opportunities – including through acquisition – to bring innovation and choice to more people in the UK and around the world.»
A fine for pursuing the integration of Giphy
During the appeal trial in April, Meta’s lawyers argued that the platform had received no firm offer to buy Giphy, which they said showed its growth prospects in the UK advertising market were not. necessarily stratospheric.
An alternative proposal to 142 million dollars had been considered by Snap, parent company of the social network Snapchat, but the latter had finally set its sights on Gyfcat, a competing platform of Giphy, had explained to AFP a source close to the file.
According to the same source, the presence on the market of Gyfcat, but also of Tenor, which belongs to Google, is also likely to guarantee the access of other platforms to “gifs”, animated illustration images, which which was another fear of the CMA.
For Meta, this acquisition was notably a way to integrate into Instagram, its photo and video sharing service, the immense library of Giphy.
In October 2021, the CMA also fined Meta in the context of the merger with Giphy £50.5 million for continuing to integrate the two companies despite an ongoing investigation.
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