Meta,the Facebook parent company had purchased the Giphy, a conversational search platform in November 2021, to extend its efficiency in the technology operations and to work more actively in their social media integration with the help of interactive resources into the applications but due to possible cause of market monopoly into the social media and the advertising sector the British market and competition regulator (CMA) has squashed the tech deal and asked meta to sell this platform afresh to potential buyers to maintain the effective social media market equilibrium into the UK social media use cases.
What is Giphy..?
Giphy is a platform, Which is used to generate and access content according to the conversation and searches of the users. Accessing it, it is integrated with any other platforms, while communicating with others in the form of messages on the platform. The platform was formed in 2013 by Jace Cooke and Alex Chung to give the feel of expression to the conversation.
Who is the Competition and Markets Authority (CMA)?
The organization is a regulatory body in the UK, which is actively working on market equilibrium and equal business practices along with neutralizing monopolistic business practices, apart from the present case, the organization has been harsh on the technology companies like google cloud. The organization follows the best business practices to maintain the level playing fields for all levels of business in various sectors considering the business interests of that business within the UK.
The Facebook and Instagram parent organization meta acquired the famous gif-creating and sharing platform giphy last year in November. As per one report, the Giphy was estimated to be worth about $400 million during this acquisition. Since, the giphy carries an important part in communication, which comprises one billion gifs used every month in the UK, out of which more than 70% of users are also constantly active on the meta subsidiary companies like Facebook and Instagram.
As per the CMA, this acquisition can be a potential threat to the technology business and the communication platforms, and to moderate this situation, the organization has asked the meta to revoke this acquisition and sell the giphy to potential buyers.
The CMA considered this move taking into consideration the pleas of Twitter and Snapchat, who fear that this acquisition can potentially block them from the use of gifs from the Giphy to their platforms.The British market regulator has to take this harsh step for the first time in history, to mark as a balancing step while considering the interests of the diverse users of the UK for all the technological platforms.