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Britain to continue to investigate Facebook acquisition of Giphy
The UK Competition and Markets Authority (CMA) expressed concern that Facebook’s acquisition of Giphy’s animated image service could reduce competition in the country’s online advertising market. The department announced the completion of the first stage of the investigation of the transaction, which was closed in May last year, but in a few days the second stage may begin.
According to CMA, the deal will leave Giphy “less incentive” to expand its digital advertising, potentially leading to less competition in the online advertising market. The regulator also fears that the purchase of Giphy will harm competition between Facebook and other social platforms. This fear stems from the fact that Giphy may stop providing services to Facebook’s competitors or change the terms of interaction, making them less profitable.
The completion of the first phase of the investigation, which began in January of this year, was announced this week. However, as early as five days later, the second stage may begin if the companies do not provide the regulator with a concrete action plan aimed at eliminating the negative consequences that may arise as a result of the transaction to purchase Giphy. A Facebook spokesman, commenting on this issue, stressed that the company intends to continue cooperation with CMA in the framework of this investigation.
As a reminder, Facebook announced the purchase of the animated image service Giphy in May last year. The exact amount of the transaction was not announced, but knowledgeable sources voiced the figure of $ 400 million.