Microsoft and Activision Blizzard’s ol’ archnemesis the CMA has stepped in to protect the UK from a different American-based antitrust threat, this one coming from Meta as it issues its final order for the company to sell Giphy.
The Competition and Markets Authority (CMA) finish providing the UK’s Competition Appeal Tribunal the necessary full and un-redacted disclosure Meta requested in appeals, and in doing so, the CAT upheld the CMA’s original decision ordering Meta divest itself from Giphy over a year ago.
Per its mandate, the CMA continues to act as the watchdog for UK competition and saw a potential future where Meta and Giphy combined would ultimately result in limited choices for UK social media users while simultaneously tempering innovation gains in other sectors.
The CMA followed the ruling with a press release detailing parts of its decision that further cemented its position during the three extra months of review.
- denying or limiting other social media platforms’ access to Giphy GIFs, thereby pushing people to Meta-owned sites, which already make up 73% of user time spent on social media in the UK, or
- changing the terms of access – for example, it could require Giphy customers, such as TikTok, Twitter and Snapchat, to provide more data from UK users in order to access Giphy GIFs.
Plainly put by the chair of the independent inquiry group outsourced for the review Stuart McIntosh, “This deal would significantly reduce competition in two markets. It has already resulted in the removal of a potential challenger in the UK display ad market, while also giving Meta the ability to further increase its substantial market power in social media.”
Interestingly enough, when TechCrunch reached out for comment, Meta figuratively shrugged its shoulders at the reversal of its $400m deal with Gifpy and responded with the following,
We are disappointed by the CMA’s decision but accept today’s ruling as the final word on the matter,” said a spokesperson in an emailed statement. “We will work closely with the CMA on divesting Giphy. We are grateful to the Giphy team during this uncertain time for their business, and wish them every success. We will continue to evaluate opportunities — including through acquisition — to bring innovation and choice to more people in the UK and around the world.
The minor setback of having to unwind its yearlong purchase of Giphy hasn’t slowed down Meta which is already gearing up to go head-to-head against the US Federal Trade Commission over the purchase of VR fitness platform, Within as it looks to jump start its metaverse