Economy

United Kingdom and Australia investigating Facebook's GIPHY deal

United Kingdom and Australia investigating Facebook's GIPHY deal”

Giphy - the internet's go-to destination for GIFs thanks to its trove of looping clips of cute animals, weird cartoon characters and mugging celebrities - on Friday released a statement seeking to downplay the importance of its new Facebook ownership.

An investigation has been launched into Facebook's acquisition of GIF sharing platform Giphy by United Kingdom regulators.

Facebook had been planning to integrate Giphy into Instagram, its photo-sharing app.

While a formal investigation has not yet begun, the Competition and Markets Authority (CMA) earlier this week delivered an initial execution order to Facebook and the first stage of an investigation began on Friday, inviting comments on the transaction of any interested part.

With an estimated 700m viewers of Giphy content each day, Facebook's acquisition was created to give the social media company leverage as it competes with new rivals such as TikTok by building the GIF platform into Instagram.

In May, the social network announced a takeover deal reported to be worth 400 million dollars. While the CMA's investigation is ongoing, Facebook and Giphy must pause efforts to combine their respective workforces, as well as any product integration initiatives they may have started. Numerous keywords users search in Giphy are terms that aren't typically entered into Google, Chung told Campaign previous year, which means Facebook would gain control of a potentially important part of the search advertising market if the CMA approves the deal. The gist of it is, CMA suspects Facebook and Giphy merging into a single entity, which would impact the competition in a negative way.

"Everyone will continue to have the same access to GIPHY", the company said.

More news: Beijing closes food market amid fears of second wave of coronavirus

However, other platforms such as Twitter and Slack have integrated Giphy support, allowing a user to search and share a GIF.

"We are prepared to show regulators that this acquisition is positive for consumers, developers and content creators alike", they said.

Facebook bought Giphy last month, and it caused a stir.

Giphy's vast library of looping short video animations is hugely popular in Facebook's apps.

The invitation to comment closes on July 3.

Facebook told Adweek that it will cooperate with the antitrust probes, and user developers' access to Giphy will not change.



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