Facebook will have to sell all of Giphy, the popular GIF-making and sharing site, after the UK’s economic competition regulator determines that its acquisition could hurt competition between social media platforms.
The middle The Verge reported that the UK Competition and Markets Authority (AMC) found among the risks of the purchase that Facebook limits or denies other platforms’ access to Giphy, to drive more traffic to Facebook, WhatsApp and Instagram, According to the agency, they already represent 73 percent of the time on social networks of British users.
In addition, there are also privacy concerns, since Meta (new name of the company that owns Facebook) could force competitors, such as Tik Tok, Twitter and Snapchat, to share more data about their users to access GIFs. .
“Without actions, [la compra] it is going to allow Facebook to increase its significant market power in social networks by controlling its competition’s access to Giphy GIFs. ”said the head of the independent research group Stuart McIntosh.
Another important point that the report considered was that Giphy also had an advertising model that competed with Facebook and that was canceled after the acquisition of the site. This was apparently an innovative service that had plans to expand to countries outside of the United States, including the United Kingdom.
After consulting with organizations and companies involved, to seek alternative solutions to the purchase, the CMA concluded that its “competition concerns” can only be addressed if Facebook sells Giphy entirely to another approved entity, the agency communicated.
Meta rejected the determination and assured that the report was wrong about Giphy’s advertising model, since it would never become a viable competition; He also explained that half of the site’s traffic was already coming from Facebook and it didn’t have significant traffic on its own.
In accordance with The Verge, the investigation and determination of the CMA are part of a new wave of scrutiny regarding the concentration of the Internet market, which is in stark contrast to the time when Meta acquired other companies such as Instagram or WhatsApp.
Picture of Anthony Quintano (CC BY 2.0)
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