UK competition watchdog orders Facebook to sell off Giphy

Nov 29, 2021, 12:42 PM | Updated: Nov 30, 2021, 3:52 am
FILE - This March 29, 2018 file photo shows the Facebook logo on screens at the Nasdaq MarketSite, ...

FILE - This March 29, 2018 file photo shows the Facebook logo on screens at the Nasdaq MarketSite, in New York's Times Square. The United Kingdom’s antitrust watchdog has blocked Facebook’s acquisition of GIF-sharing platform Giphy and ordered the social network to reverse the deal. It said Tuesday that the deal hurts social media users and advertisers by stifling competition for animated images. (AP Photo/Richard Drew, File)

(AP Photo/Richard Drew, File)

LONDON (AP) — The United Kingdom’s antitrust watchdog has blocked Facebook’s acquisition of Giphy and ordered the social network to sell off the GIF-sharing platform, saying the deal hurts social media users and advertisers by stifling competition for animated images.

The Competition and Markets Authority said Tuesday that the deal would let Facebook “increase its already significant market power” by denying or limiting other platforms’ access to Giphy GIFs and driving traffic to Facebook-owned sites. It has noted previously that there’s only one other big provider of GIFs, Google’s Tenor.

The regulator also was concerned that the deal removed potential competition from the U.K.’s 7 billion pound ($9.3 billion) display advertising market, of which Facebook controls half.

It’s the first time the watchdog has sought to unwind a tech deal, marking an escalation by regulators seeking to tame digital giants.

Facebook, which has been renamed Meta, said it disagreed with the decision and is considering all its options, including an appeal.

“Both consumers and Giphy are better off with the support of our infrastructure, talent, and resources,” the company said. “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.”

After consulting with other businesses and groups and assessing alternative solutions proposed by Facebook, the watchdog said it “concluded that its competition concerns can only be addressed by Facebook selling Giphy in its entirety to an approved buyer.”

Stuart McIntosh, chair of the watchdog’s independent group that carried out the investigation, said the deal “has already removed a potential challenger in the display advertising market.”

“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,” he said. “By requiring Facebook to sell Giphy, we are protecting millions of social media users and promoting competition and innovation in digital advertising.”

New York-based Giphy’s library of short looping videos, or GIFs, are a popular tool for internet users sending messages or posting on social media.

The two sides have waged a bitter battle over the deal, reportedly worth $400 million.

The Competition and Markets Authority said in a provisional decision in August that Facebook should be forced to sell Giphy. The social giant responded with a strongly worded letter, saying the provisional decision contained “fundamental errors.”

Last month, the watchdog fined Facebook 50.5 million pounds ($67.4 million) for failing to provide information needed for the investigation, saying the company’s failure to comply was deliberate.

The watchdog has said that prior to the deal, Giphy had been considering expanding its advertising services to other countries, including the U.K. That would have added a new player to the market and encouraged more innovation from social media sites and advertisers, but Facebook terminated Giphy’s ad partnerships after announcing the deal, it said.

___

For all of AP’s tech coverage, visit https://apnews.com/apf-technology

___

Follow Kelvin Chan at https://www.twitter.com/chanman

Copyright © The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

AP

FILE - Olavo de Carvalho, 72, sits at a desk in Dinwiddie County, Virginia, May 30, 2019. Carvalho,...
Associated Press

Divisive Brazilian right-wing philosopher, provocateur dies

RIO DE JANEIRO (AP) — Olavo de Carvalho, a leading light of Brazil’s conservative movement who was celebrated by devotees and loathed by detractors, has died, according to a statement published Tuesday on his official Twitter profile. He was 74. De Carvalho died Monday night in Virginia, where he had been living for over a […]
1 day ago
Associated Press

Man who stuffed wife’s body in freezer sentenced to 25 years

MARSHFIELD, Mo. (AP) — A Missouri man who pleaded guilty to stuffing his wife’s body in a freezer more than six years ago has been sentenced to 25 years in prison. Larry Dinwiddie, 59, of Marshfield, was sentenced Monday after he pleaded guilty in November to second-degree murder in the death of Cynthia Dinwiddie, television […]
1 day ago
Associated Press

GE expects return to revenue growth in 2022

General Electric Co. anticipates returning to revenue growth this year, even as it deals with supply chain challenges. The company said Tuesday that it anticipates aviation revenue rising more than 20% in 2022, dependent on the continued commercial market recovery. It foresees low- to mid-single-digit revenue growth in healthcare, driven by commercial efforts and new […]
1 day ago
In this Dec. 31, 2021 photo provided by Zachary Holderby, a Steller's sea eagle is seen off Georget...
Associated Press

Rare eagle seen in Maine, wowing birders, might stay a bit

GEORGETOWN, Maine (AP) — A rare species of eagle that has thrilled bird lovers and baffled scientists since arriving in Maine last month might not be in a hurry to leave. The Steller’s sea eagle arrived in Maine in late December after a brief stop in Massachusetts more than a month ago. It has stuck […]
1 day ago
FILE- In this May 2, 2021, file photo, a General Motors sign hangs on the side of a Chevrolet showr...
Associated Press

Michigan OKs $824M in incentives for GM’s EV, battery plants

LANSING, Mich. (AP) — Michigan’s economic development board on Tuesday approved $824 million in incentives and assistance for General Motors Co. to put electric vehicle and battery plants in its home state, adding as many as 4,000 jobs. The Detroit-based automaker plans to spend up to $4 billion converting and expanding its Orion Township assembly […]
1 day ago
This combination of photos shows Paula Eiselt, left, and Tonya Lewis Lee, co-directors of the film ...
Associated Press

‘Aftershock’ puts human face to maternal health crisis in US

It was 2017 when filmmaker Paula Eiselt started seeing articles about rising maternal mortality rates in the United States. She’d had traumatic experiences giving birth to her four children, but didn’t realize that the problems were widespread and disproportionately affecting Black women. Tonya Lewis Lee, in her travels and conversations promoting infant mortality awareness, had […]
1 day ago

Sponsored Articles

...

Compassion International Is Determined to ‘Fill’ a Unique Type of Football ‘Stadium’

Compassion International SPONSORED — During this fall’s football season—and as the pandemic continues to impact the entire globe—one organization has been urging caring individuals to help it “fill” a unique type of “stadium” in order to make a lasting difference in the lives of many. Compassion International’s distinctive Fill the Stadium (FtS, fillthestadium.com) initiative provides […]
...

What are the Strongest, Greenest, Best Windows?

Lake Washington Windows & Doors SPONSORED — Fiberglass windows are an excellent choice for window replacement due to their fundamental strength and durability. There is no other type of window that lasts as long as fiberglass; so why go with anything else? Fiberglass windows are 8x stronger than vinyl, lower maintenance than wood, more thermally […]
...

COVID Vaccine is a Game-Changer for Keeping our Kids Healthy

Snohomish Health District SPONSORED — Cheers to the parents and guardians who keep their kids safe and healthy. The dad who cooks a meal with something green in it, even though he’s tired and drive-thru burgers were tempting. The mom who calms down the little one who loudly and resolutely does NOT want to brush […]
...
Experience Anacortes

Coastal Christmas Celebration Week in Anacortes

With minimal travel time required and every activity under the sun, Anacortes is the perfect vacation spot for all ages.
...

Delayed-Onset PTSD: Signs and Symptoms

Lakeside-Milam Recovery Centers SPONSORED — You’re probably familiar with post-traumatic stress disorder. Often abbreviated as PTSD, this condition is diagnosed when a person experiences a set of symptoms for at least a month after a traumatic event. However, for some people, these issues take longer to develop. This results in a diagnosis of delayed-onset PTSD […]
...

Medicare open enrollment ends Dec. 7. Free unbiased help is here!

Washington State Office of the Insurance Commissioner SPONSORED — Medicare’s Open Enrollment Period, also called the Annual Election Period, is Oct. 15 to Dec. 7. During this time, people enrolled in Medicare can: Switch from Original Medicare to a Medicare Advantage plan and vice versa. Join, drop or switch a Part D prescription drug plan, […]
UK competition watchdog orders Facebook to sell off Giphy