Final judgment has been reached, and the U.K.'s Competition and Markets Authority (CMA) has mandated that Meta, the company that runs Facebook, WhatsApp, and Instagram, sell GIF maker Giphy. Meta won't challenge the ruling.
Giphy was acquired by Meta for $400 million in 2020, but the CMA objected, finding provisionally in August 2021 that the transaction would harm competition among social media sites. The CMA penalized Meta in October 2021 for failing to give frequent updates on the compliance procedure that it had demanded. Additionally, the CMA ordered Meta to sell Giphy in November 2021.
The verdict was challenged by Meta, and the CMA looked at Giphy's and Meta's fresh filings. It reached the same conclusions it had when issuing the original sell order: Meta would be able to increase its already substantial market power by denying or restricting access to Giphy GIFs on other social media platforms, driving users to Meta-owned websites, which already account for 73% of user time spent on social media in the U.K., or by changing the terms of access that might require Giphy customers, like TikTok, Twitter, and Snapchat, to provide more data.
“We are disappointed by the CMA’s decision but accept today’s ruling as the final word on the matter. We will work closely with the CMA on divesting Giphy. We are grateful to the Giphy team during this uncertain time for their business, and wish them every success. We will continue to evaluate opportunities – including through acquisition – to bring innovation and choice to more people in the U.K. and around the world.” - Meta company spokesperson