Britain might require Facebook to sell GIF website Giphy after the country’s competition regulator said on Thursday its investigation found the deal between the two companies would hurt the display advertising market.
Facebook, the world’s largest social media company, bought Giphy, a website for making and sharing animated images, or GIFs, in May last year to integrate it with its photo-sharing app, Instagram. The deal was pegged at $400 million by Axios.
The UK’s Competition and Markets Authority (CMA) began a probe into the deal in January, and in April referred the deal to an in-depth investigation.
“Giphy’s takeover could see Facebook withdrawing GIFs from competing platforms or requiring more user data in order to access them. It also removes a potential challenger to Facebook,” said Stuart McIntosh, chair of the independent investigation for the CMA.
Another major provider of GIFs is Google’s Tenor.
The CMA found that, before the Facebook deal, Giphy was considering expanding its paid advertising services offered in the United States to other countries, including the UK. However, Facebook terminated Giphy’s ad partnerships following the deal, according to the regulator.