Facebook Paid $ 400 Million Strength May Be Forced Now For Sale
Facebook purchased Giphy, a website for creating and sharing animated images, or GIFs, in May 2020 to integrate it with its photo sharing program, Instagram.
Britain may require Facebook to sell the GIF Giphy website after the country’s competition regulator said on Thursday its investigation found that the two companies’ agreement would hurt the advertising market.
Facebook, the world’s largest telecommunications company, purchased Giphy, a website for creating and sharing animated images, or GIFs, in May last year to integrate it with its photo sharing program, Instagram. The deal was awarded to Axios for $ 400 million.
The UK Competition and Markets Authority (CMA) launched an investigation into the deal in January, and in April referred the agreement to a thorough investigation.
“Giphy’s take can see that Facebook withdraws GIFs from competing platforms or requires additional user data to access them. It also removes potential challenges to Facebook,” said Stuart McIntosh, chair of the CMA’s independent investigation. Another great GIF provider is Google’s Tenor.
The CMA found that, prior to the Facebook agreement, Giphy was considering expanding his paid advertising services offered in the United States to other countries, including the UK. However, Facebook terminated Giphy’s advertising relationship following the agreement, according to the regulator.
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“We do not agree with the initial results of the CMA, which we do not believe is supported by evidence. As we have shown, this merger greatly benefits people and businesses in the UK – and around the world,” a Facebook spokesman said.
The lawyer added that California-based companies would continue to work with CMA. Giphy declined to comment.
This is not the first time the CMA has raised concerns about big deals. The $ 9.2 billion eBay-Adevinta deal has caught the eye, and the CMA has asked new owners of Asda supermarket to address concerns over fuel competition.
The Security Council said in a statement that they had made a concerted effort to resolve the issue of CMA, and now invite comments from all concerned on September 2 on its interim results.
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