The Competition and Markets Authority (CMA) has confirmed that Meta – formerly Facebook – must sell GIF-sharing platform Giphy.

The UK watchdog found the deal would reduce competition between social media platforms and said it had already removed Giphy as a potential challenger in the display advertising market.

A Meta spokesperson said that the company disagrees with the decision and is considering all options, including appeal.

"Both consumers and Giphy are better off with the support of our infrastructure, talent, and resources," they added. "Together, Meta and Giphy would enhance Giphy’s product for the millions of people, businesses, developers and API partners in the UK and around the world who use Giphy every day, providing more choices for everyone.”

The independent CMA panel reviewing the merger concluded that Meta would be able to increase its already significant market power in relation to other social media platforms by denying or limiting other platforms’ access to Giphy GIFs, driving more traffic to Facebook-owned sites – Facebook, WhatsApp, and Instagram – which already account for 73 per cent of user time spent on social media in the UK, or changing the terms of access by, for example, requiring TikTok, Twitter, and Snapchat to provide more user data in order to access Giphy GIFs.

“The tie-up between Facebook and Giphy has already removed a potential challenger in the display advertising market,” explained Stuart McIntosh, chair of the independent inquiry group carrying out the second phase of the investigation. “Without action, it will also allow Facebook to increase its significant market power in social media even further, through controlling competitors’ access to Giphy GIFs.”

The chair said that the move will protect millions of users and promote competition in digital advertising.

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