trump card May be forced to reverse its multi-million pound acquisition Giffy After the UK competition regulator stated that the transaction could harm other social media sites.
The Competition and Markets Authority (CMA) said it may force the cancellation of a $400 million (£289 million) acquisition.
CMA said that Facebook can use the acquisition to deny other social media platforms access to Giphy’s dynamic images, called gifs.
Millions of people around the world use these gifs, if Facebook wants to delete them from other platforms, such as Tik Tok Either Twitter It may make people stop using these social media sites.
Facebook can also use its control of Giphy to ask its competitors to hand over more data about its users.
“Such actions may increase Facebook’s market power, which is already important,” CMA said.
Facebook said it disagrees with the CMA’s findings.
The Giphy acquisition may cause Facebook to withdraw gifs from competing platforms or require more user data to access them
More than 70% of the time people spend on social media is on Facebook or WhatsApp and Instagram, both of which are its own.
Stuart McIntosh, who led the CMA survey, said: “Millions of people share gifs with friends, family and colleagues every day, and this number continues to grow.
“Giphy’s acquisition may cause Facebook to withdraw gifs from competing platforms, or require more user data to access them.
“It also eliminates Facebook’s potential challenger in the £5.5 billion display advertising market. not any This is good news for customers. “
“Although our investigation revealed serious competition issues, these are temporary. Before completing the review, we will now consult on the results of our investigation.
“If we conclude that the merger is harmful to the market and social media users, we will take the necessary actions to ensure that people are protected.”
US-based Facebook and Giphy announced in May 2020 that they would merge.
In January of this year, CMA began an investigation into this case. It will release its final report in October.
Facebook said: “We do not agree with the CMA’s preliminary investigation results, and we believe that the investigation results are not supported by evidence.
“As we have proved, this merger is in the best interests of the people and companies that use Giphy and our services in the UK and around the world.
“We will continue to work with CMA to resolve the misunderstanding that transactions harm competition.”
