Did you know Facebook is being accused of taking over most of the GIFs market through its deal with Giphy
Giphy is an American online search engine founded by Alex Chung and Jace Cooke in February of 2013. It is a platform that allows its users to search for short looping videos that have no sound and share it with their friends. These short looping videos resemble animated GIF files. Giphy was bought by Facebook in May of 2020 for valued at 300 or 400 million dollars.
Giphy is said to be Facebook’s largest deal ever. It has been reported that the United Kingdom’s Competition and Market Authority (CMA) is accusing Facebook of taking over most of the supply of GIFs through its acquisition of Giphy. The competition after Facebook’s complete acquisition of this search engine Giphy is almost gone. When Facebook made this deal both the parties at the UK and Australia showed their disapproval at this deal because buying rivals almost kills the competition from the market and because of this deal Facebook even faced two major antitrust lawsuit from the United States last year and this isn’t the only time that Facebook faced such a situation.
Giphy is a search engine that supplies around 10 billion GIFs to millions of people every day and claims to be the second largest search engine in the world. Gippy has also made an attempt to compete with major tech companies such as Google. Giphy’s founder Alex Chung, in an interview told New Atlas that the whole goal of Giphy was to see if they can revolutionize search engine market, not in the category of information but in ways through which people express their emotions and can define their culture that is, through GIFs.
The CMA feel that Giphy will soon have less motivation and resources for it to expand its digital advertising and that Facebook will then increase its power of interaction with rival platforms so as to not risk its position and power. When there were several oppositions to this deal of Gippy and Facebook, both of these tech giants assured that other networks will still get their regular supply of GIFs but since May, Giphy has not supplied its GIFs to other new networks. When the deal was made and other networks were worried for their GIFs supply, social media platforms like Signal and Telegram said that if such a situation was to arise, then they will come up with other preventive measures to apply in order to not let their services be affected by this deal.
CMA has given Facebook a deadline, and if Facebook fails to respond within that, then it will carry a full investigation over this alleged monopoly.
