Meta has again been ordered by the UK’s competition watchdog to sell animated GIF platform, Giphy.
Recall that Meta bought Giphy for $315 million in 2020.
It will increase its already significant market power by denying or limiting other social media platforms’ access to Giphy GIFs by pushing people to Meta-owned sites, which already make up 73% of user time spent on social media in the UK.
In a press release, the Competition and Markets Authority (CMA) said that Meta’s takeover of Giphy could decrease competitors’ access to GIFs and give the company an unfair advantage in the social media and digital advertising markets. The decision ended a lengthy appeals process that began last year.
“The only way this can be addressed is by the sale of Giphy,” said Stuart McIntosh, who chaired the CMA’s investigation into the deal.
“This will promote innovation in digital advertising, and also ensure UK social media users continue to benefit from access to Giphy.”
Meta said it is disappointed but accepts the CMA’s ruling as the “final word” on the matter, pledging to work closely with the regulators to divest from Giphy.
Meta bought Giphy at a moment when GIFs were considered an ascendant form of visual communication.
But digital culture has changed rapidly since then, and Meta itself conceded that young people now think GIFs are “cringe.”