UK Regulator Expected To Block Meta's Giphy Deal

The UK competition regulator is expected to block Meta's $315m acquisition of online gif platform Giphy in the coming days in an escalation of the watchdog's assault on Big Tech. Financial Times: The Competition and Markets Authority is set to reverse the deal according to individuals close to the matter, in what would be the first time the CMA has unwound a Big Tech deal. The watchdog began investigating Meta's acquisition of New-York based Giphy -- the biggest provider of animated images known as gifs to social networks -- in June last year. A decision to block the deal would set an eye-catching precedent from the UK regulator, which has never sought to reverse a completed tech deal. In August the CMA provisionally ruled Meta, formerly known as Facebook, should be forced to sell Giphy due to competition concerns. It has until December 1 to make a final call. At that time the CMA argued Meta could cut off its rivals' access to gifs, and demand platforms like TikTok or Snapchat hand over more of their data in order to access gifs, consolidating power in Meta's hands. The watchdog also said the deal could remove a competitor to Meta in the display advertising market in the UK, despite Giphy's lack of presence in that sector.

That's some heavily loaded language there

[rsilvergun]

Since when is enforcing basic antitrust laws in "assault"? When people talk about a pro-corporate bias in media this is what they mean.

Re:

[youngone]

The link is to the Financial Times which is read by people who would sell their Grandmother for chemicals if they thought they could make a profit out of it.

How is the UK having affect on two US companies?

[cayenne8]

Ok Meta (FB) and apparently the "NY based Gliphy" are both US companies.

How would a UK or any other external country's legal rulings on mergers, etc have any effect whatsoever on these two US based companies?

Re:

[mccalli]

Same way US has on other jurisdictions. They companies can choose to ignore the ruling and leave the UK markets and merge anyway, same way someone could choose to leave the US markets and e.g. continue to trade with US-embargoed countries.

Re:

[cayenne8]

I don't think the US has made any rulings on whether two foreigner based companies could merger....?

I don't think a UK anti-trust case has any merit on two US based companies.

I've just never heard of a country external to two companies in a different country's business deals on whether there can be a merger, takeover, etc...

And the UK is really gonna force FB out of there?

Although that might in fact be a good thing for the citizens over there, I don't see that happening.

But it really seems an overreach

Re:

[drinkypoo]

I don't think the US has made any rulings on whether two foreigner based companies could merger....?

The US is notoriously soft on antitrust these days. That's wholly irrelevant.

And the UK is really gonna force FB out of there?

Probably they will just fine them, then if they don't pay, seize their assets. They are strapped for cash and have no real competitors to Faceboot so it makes more sense to fine them than to simply prohibit them from operating.

Re:

[mccalli]

There often are. The question isn't where the company is based, the question is the effect on the market that the local regulator has jurisdiction over.

It isn't "you can't merge". It's "you can't operate in our area if you merge". Where 'our area' is whatever regulator we're talking about - in this case the UK, but there's also e.g. EU looking at ARM/Nvidia etc.. It's honestly not that unusual - financial services are often a target of investigation.

Although must admit - seeing 'giphy' and 'UK Competi

Re:

[pjt33]

Giphy may be small enough to really be a "US company", but Facebook is a multinational company whose shares trade on a US stockmarket. Its corporate structure is far too extended for it to be subject to only one country's regulators.

Assault?

[Dixie_Flatline]

The UK competition regulator is expected to block Meta's $315m acquisition of online gif platform Giphy in the coming days in an escalation of the watchdog's assault on Big Tech.

I dunno man, maybe it's just making sure that our future isn't just one company that owns friggin' everything. It's not like it would be super hard to build a better Giphy if you were a company as big as Meta.

Re:

[Virtucon]

I'm gonna build my own Giphy with blackjack and hookers!

- Future Bender

Re:

[RazorSharp]

It's not like it would be super hard to build a better Giphy if you were a company as big as Meta.

That would mean competing with the competition rather than eliminating it. That's antithetical to Facebook's business model, which is hyper-aware that being "free" means that an upstart could unseat them at any time. After all, that's how they became Facebook and MySpace became forgotten.

Assault?

[jd]

Facebook is not exempt from the law. Now, one might argue overreach, if it's two US companies, but even there it depends on whether there's a legally-recognized point of presence in the UK. I assume the UK competition regulator is ruling something about the UK but as the ruling only applies to the UK (something to do with taking back their own borders), it only affects Facebook UK (insomuch as there is a Facebook UK).

So, if the parent company (which exists elsewhere) is unaffected, what precisely is being a

Re:

[jabuzz]

Basically it would mean if the merger went ahead that the Facebook would not be able to operate in the UK.

Now Facebook might decide loosing access to one of the largest economies in the world is fine and go ahead with the merger any way. On the other hand they might decide that the value to them of the merger is less than loss of access to the UK market is and not go ahead with the merger.

It is likely that the EU will come to the same decision too.

"provider"?

[nagora]

I thought Giphy was just a publisher. Do they actually make the gifs themselves?