[UPDATE] Meta, Facebook’s Parent Company, is Officially Ordered to Sell Giphy

Meta, the parent company of Facebook, has been ordered by the United Kingdom's Competition and Markets Authority (CMA) to sell GIF-making site Giphy.

The CMA has cited its concerns about Meta's acquisition of Giphy, including the limiting of access other platforms can have of the site. The competition regulator believes that Meta can best address the concerns by selling Giphy.

Meta, previously known as Facebook, announced last year that it was acquiring Giphy for a reported $400 million. The CMA fined Meta last month for not completely disclosing certain information about its Giphy acquisition.

Meta Ordered to Sell Giphy

Meta, Facebook's parent company, has been ordered to sell GIF-making site Giphy by the U.K.'s Competition and Markets Authority.

According to a press release of the CMA, the U.K.'s competition regulator "requires Facebook (which has recently renamed itself 'Meta') to sell Giphy, after finding that the deal could harm social media users and UK advertisers."

The Verge says in its report that the CMA believes that Meta's acquisition of Giphy limits the access other platforms can have of the GIF-making website. Furthermore, the CMA believes that the acquisition has led to more traffic for Facebook, Instagram, and Whatsapp.

The CMA has also pointed out that Giphy's advertising services would have provided strong competition for Meta, but the services were shut down due to the acquisition.

The report says that the CMA believes that Meta can address the concerns raised by the competition regulator by selling Giphy.

Stuart McIntosh, the chairperson of the independent inquiry group, was quoted in the press release saying "By requiring Facebook to sell Giphy, we are protecting millions of social media users and promoting competition and innovation in digital advertising."

According to The Verge, Meta is highly likely to appeal the decision made by the CMA.

Meta's Acquisition of Giphy

Meta's acquisition of Giphy was announced last year. At that time, Meta was still known by its former name, Facebook.

According to a previous Tech Times report, the acquisition reportedly cost Meta $400 million.

It was reported just last month that the CMA fined Meta a whopping $70 million for its failure to disclose all pertinent information with regards to its acquisition of Giphy.

Per the report by The Verge, the CMA's move to order Meta to sell Giphy marks the competition regulator's first attempt at "unwinding a completed acquisition by a tech giant."

The report also notes that while the "groundbreaking" move sets a precedent for future acquisitions made by tech giants, the move is not surprising anymore. This is due to a preliminary findings report, which was released in August, that said Meta's acquisition of Giphy should be unwound

This article is owned by Tech Times

Written by Isabella James