I'd say a way better approach is what was on HN recently where the chat platforms will have to enable 3rd party integrations effectively breaking the walled gardens. It makes way more sense to collapse the walls than distance and split the gardens
I'm doubtful if there is any material harm in those companies being under the same roof, and the benefit to consumers may just be that they are free services, but that doesn't have to be demonstrated.
They are not essential services, it's better to just not use them if you don't like them.
Where there needs to be more regulation is in Search Monopoly, Search Result Transparency, App Store Monopolies etc. - there are serious consumer and industry issues there.
I think there is consumer benefit to scale (particularly when it comes to social networks), and I don't see how Instagram and Facebook being separate entities improves or changes anything. They'll have the exact same owners, same employees, same management... the only difference will be that Zucc gets richer and the employee's W-2s will say Instagram Inc instead of Meta inc.
Be careful. You and I aren't consumers of Meta. We're part of the product. You're arguing that advertisers should get a better deal since they are the consumers in this case. Personally I don't like advertisers and seeing them get lower prices, more space etc does nothing for the average citizen imho...
> I want this to be the start of a forced breakup of Facebook, WhatsApp and Instagram.
okay
> There’s zero benefit to consumers, and a lot of harm.
There's a ton of potential societal benefit in centralization and/or monopoly in theory. There's also a ton of potential downside. What in particular makes this fall in the latter bucket?
"The acquirer may quickly take steps to consolidate its investment by removing the parts of its own business that compete with the target. If the CMA were prevented from making orders that impinged on the acquirer's existing business, divestiture at the end of a relatively lengthy process would, by itself, be incapable of either restoring the status quo at the time of the merger or protecting competition in the relevant market."
It looks like the CMA have the right to roll things back as if the merger never took place to the detriment of the acquirer (Facebook). Its likey Giphy won't suffer any losses, rather Facebook will be forced to compensate it, prehaps the plan all along for the VCs :P
How does such a retroactive block work ? I imagine Meta executives have already taken over the reigns and directed the company towards full integration with facebooks other services. If Giphy had had a project in the works that could disrupt any of Facebooks monopolies than surely that project would be canceled by now and anyone involved would have transferred internally to the relevant Meta subgroup or left.
So if blocking the deal results in Meta loosing control of Giphy but getting it’s money back, wouldn’t that be a great outcome for Meta as they would have achieved their main goal for free ?
Disclaimer: worked for the Austrian cartel prosecutor:
Such (as in: requiring regulatory approval in general, as I cannot legally speak to this deal specifically) takeover deals are structured with a suspensive condition, pending regulatory approval. Until that condition is met, it remains pending and without effect.
So Facebook hoovering up Instagram and WhatsApp is fine, but we draw the line at, of all things, GIFs? Seems like backwards priorities and tokenism to me.
Giphy hosts images on thousands and thousands of other websites.
They're buying analytics access to further enable them to profile their users, sell that as an advertising platform.
Instagram, WhatsApp give deep profiles into their users but they're pretty up front about what they can do. CDNs need to be treated in special ways. They can leak information back to someone like FB and deanonymise activity.
> Facebook controls 40 to 50 per cent of the UK display advertising market according to the CMA. Giphy had offered paid advertising in the US and the CMA argued that, absent the merger, Giphy could have gone on to expand that service into the UK — something the company has denied.
I'm guessing its related to this point.
However,
> . In a response to the CMA’s provisional findings Meta accused the watchdog of “engaging in extraterritorial over-reach”
And yet the EU is also doing the same,
> In Brussels, EU officials are looking at new ways to examine mergers that fall outside their scope on the basis of revenues alone
Meta/FB has a legal presence in the UK and offers services in the UK. It needs to operate according to UK Law.
In practice, I don't know what the reality of this will mean. Does Giphy continue to operate as a separate company in the UK then? How's that going to work?
I'd love any pointers to precedent for how this plays out from here.
1. The acquisition was >1 year ago. (And there's some question of whether FB followed the correct process.)
2. The antitrust concern is in one major market with a ton of political and regulatory power — but still one of many. (Are there international trade agreements that inherently make this ruling impactful outside of the UK?)
3. The acquired company was very unlikely to find a better outcome, and would have been fairly likely to require costly restructuring for lack of this one.
I don't take this super seriously — because giphy feels replicable and, well, it's gifs. But curious if anyone else sees impactful competitive/strategic concerns, or if the matter at hand is really just political precedent setting.
Mostly I feel bad for giphy people. Hope they're nicely contractually protected.
In any acquisition an assessment of the regulatory risks has to be part of the process for the vendor. They took a risk in selling to FB and that risk hasn’t paid off. No one is entitled to the ‘best’ price if it involves something which falls foul of competition law.
And on competition - will anyone else be interested in GIFs if the dominant social network owns the market leader?
What if Meta obtain a monopoly on the supply of funny gifs.
> "At that time the CMA argued Meta could cut off its rivals’ access to gifs, and demand platforms like TikTok or Snapchat hand over more of their data in order to access gifs, consolidating power in Meta’s hands."
It... it seems like that may be a fair summary of the regulator's concern :/
Giphy is integrated in smartphone keyboards for hundreds of millions of devices, and it is a fast track to a large trove of personal data for Facebook.
whatsapp was/is a "market leader" in community watch groups, literally embedded in the city landscape. with the facebook acquisition suddenly all these local groups became a data mining and selling property, with the participating folks a captive population.
greed has overfloweth, lack of any moral compunction is the rule of the game.
fine but this usually bites back in ways not immediately obvious. so don't ask why the world is going to hell one crisis at a time.
Definitely not. This kind of brand whitewashing should be ignored as much as possible and whenever the 'new' brand is mentioned it should be followed by major former brand in brackets ('Facebook') to ensure that people aren't duped.
I don't care about this particular decision. That said, it's interesting that approval for mergers and acquisitions:
* Has become an international affair where not just big but small countries expect a veto.
* Is not predictable. This and other deals have been approved in some jurisdictions but then refused in others. And without apparent reason why what is a monopoly in one place isn't in others.
* Take very long periods of time (this deal was first announced on may 2020, didn't get provisional refusal until August 2021 and now is still uncertain).
Imagine trying to run a company for 18 months while your existence and entire future is entirely down to the flip of a coin.
Imagine the possibility for corruption and nepotism and backroom deals.
I'd really like to see some simplification in this area before it goes bad.
The Arm NVidea acquisition is just as bad. Publicly announced over a year ago. Europe just opened an investigation. What have they been doing for a year? What happens when someone in that office let's drop that for 0.1% of the deal price he can make it happen, or they can wait another few years for a preliminary refusal?
> * Has become an international affair where not just big but small countries expect a veto.
Small countries have the right to control what happens in their own markets too.
> * Is not predictable. This and other deals have been approved in some jurisdictions but then refused in others. And without apparent reason why what is a monopoly in one place isn't in others.
Different countries have different laws.
> * Take very long periods of time (this deal was first announced on may 2020, didn't get provisional refusal until August 2021 and now is still uncertain).
It takes time to gather data etc.
> Imagine trying to run a company for 18 months while your existence and entire future is entirely down to the flip of a coin.
It's not the flip of a coin.
Atm / Nvidia is not great but the regulatory risk was entirely predictable and clearly Softbank was prepared to take that risk. Personally, I think it should be blocked and quickly.
This is a follow-on from the June 2020 Initial Enforcement Order (IEO) that Facebook repeatedly breached and, after two appeals, was fined £50.5m in October 2021
Do you think Giphy can do well as a stand-alone business? They're willing to sell for $400M despite taking $150M in VC, which suggests that the company itself doesn't really believe it.
Yea don't block the acquisitions of Instagram and WhatsApp but block the acquisition of irrelevant GIF company. Totally makes sense. Politically motivated decision that's what it is.
Ugh. So they'll block this but the government allows the likes of private equity to buy companies who will then assert strip or load up the target with debt.
[+] [-] blowski|4 years ago|reply
[+] [-] kungito|4 years ago|reply
[+] [-] tchalla|4 years ago|reply
[+] [-] jollybean|4 years ago|reply
I'm doubtful if there is any material harm in those companies being under the same roof, and the benefit to consumers may just be that they are free services, but that doesn't have to be demonstrated.
They are not essential services, it's better to just not use them if you don't like them.
Where there needs to be more regulation is in Search Monopoly, Search Result Transparency, App Store Monopolies etc. - there are serious consumer and industry issues there.
[+] [-] missedthecue|4 years ago|reply
[+] [-] LatteLazy|4 years ago|reply
[+] [-] zethraeus|4 years ago|reply
okay
> There’s zero benefit to consumers, and a lot of harm.
There's a ton of potential societal benefit in centralization and/or monopoly in theory. There's also a ton of potential downside. What in particular makes this fall in the latter bucket?
[+] [-] timwaagh|4 years ago|reply
[+] [-] docflabby|4 years ago|reply
"The acquirer may quickly take steps to consolidate its investment by removing the parts of its own business that compete with the target. If the CMA were prevented from making orders that impinged on the acquirer's existing business, divestiture at the end of a relatively lengthy process would, by itself, be incapable of either restoring the status quo at the time of the merger or protecting competition in the relevant market."
It looks like the CMA have the right to roll things back as if the merger never took place to the detriment of the acquirer (Facebook). Its likey Giphy won't suffer any losses, rather Facebook will be forced to compensate it, prehaps the plan all along for the VCs :P
[+] [-] klelatti|4 years ago|reply
[+] [-] bijant|4 years ago|reply
[+] [-] mrleiter|4 years ago|reply
Such (as in: requiring regulatory approval in general, as I cannot legally speak to this deal specifically) takeover deals are structured with a suspensive condition, pending regulatory approval. Until that condition is met, it remains pending and without effect.
[+] [-] vineyardmike|4 years ago|reply
Ben Thompson explained why it’s not a monopoly well:
https://stratechery.com/2021/regulators-and-reality/
[+] [-] KptMarchewa|4 years ago|reply
[+] [-] aahortwwy|4 years ago|reply
They would have to find a suitable buyer, and presumably if Giphy has been gutted then it's worth considerably less than Meta paid.
[+] [-] Reason077|4 years ago|reply
[+] [-] oliwarner|4 years ago|reply
They're buying analytics access to further enable them to profile their users, sell that as an advertising platform.
Instagram, WhatsApp give deep profiles into their users but they're pretty up front about what they can do. CDNs need to be treated in special ways. They can leak information back to someone like FB and deanonymise activity.
[+] [-] ClumsyPilot|4 years ago|reply
[+] [-] LordAtlas|4 years ago|reply
[+] [-] mjburgess|4 years ago|reply
> Facebook controls 40 to 50 per cent of the UK display advertising market according to the CMA. Giphy had offered paid advertising in the US and the CMA argued that, absent the merger, Giphy could have gone on to expand that service into the UK — something the company has denied.
I'm guessing its related to this point.
However,
> . In a response to the CMA’s provisional findings Meta accused the watchdog of “engaging in extraterritorial over-reach”
And yet the EU is also doing the same,
> In Brussels, EU officials are looking at new ways to examine mergers that fall outside their scope on the basis of revenues alone
[+] [-] mixtur2021|4 years ago|reply
In practice, I don't know what the reality of this will mean. Does Giphy continue to operate as a separate company in the UK then? How's that going to work?
[+] [-] aahortwwy|4 years ago|reply
If companies don't want to comply with UK regulation they are, of course, free not to participate in the UK market.
[+] [-] zethraeus|4 years ago|reply
1. The acquisition was >1 year ago. (And there's some question of whether FB followed the correct process.)
2. The antitrust concern is in one major market with a ton of political and regulatory power — but still one of many. (Are there international trade agreements that inherently make this ruling impactful outside of the UK?)
3. The acquired company was very unlikely to find a better outcome, and would have been fairly likely to require costly restructuring for lack of this one.
I don't take this super seriously — because giphy feels replicable and, well, it's gifs. But curious if anyone else sees impactful competitive/strategic concerns, or if the matter at hand is really just political precedent setting.
Mostly I feel bad for giphy people. Hope they're nicely contractually protected.
[+] [-] klelatti|4 years ago|reply
And on competition - will anyone else be interested in GIFs if the dominant social network owns the market leader?
[+] [-] M2Ys4U|4 years ago|reply
There are more than questions - FB was found guilty and fined for not following the correct process.
[+] [-] quiffledwerg|4 years ago|reply
Good thing brexit has prevented the UK from all those crazy euro rules and regulations.
[+] [-] xyzzy123|4 years ago|reply
> "At that time the CMA argued Meta could cut off its rivals’ access to gifs, and demand platforms like TikTok or Snapchat hand over more of their data in order to access gifs, consolidating power in Meta’s hands."
It... it seems like that may be a fair summary of the regulator's concern :/
[+] [-] dessant|4 years ago|reply
Giphy is integrated in smartphone keyboards for hundreds of millions of devices, and it is a fast track to a large trove of personal data for Facebook.
[+] [-] streamofdigits|4 years ago|reply
greed has overfloweth, lack of any moral compunction is the rule of the game.
fine but this usually bites back in ways not immediately obvious. so don't ask why the world is going to hell one crisis at a time.
[+] [-] CTDOCodebases|4 years ago|reply
[+] [-] jacquesm|4 years ago|reply
[+] [-] mattowen_uk|4 years ago|reply
[+] [-] LatteLazy|4 years ago|reply
* Has become an international affair where not just big but small countries expect a veto.
* Is not predictable. This and other deals have been approved in some jurisdictions but then refused in others. And without apparent reason why what is a monopoly in one place isn't in others.
* Take very long periods of time (this deal was first announced on may 2020, didn't get provisional refusal until August 2021 and now is still uncertain).
Imagine trying to run a company for 18 months while your existence and entire future is entirely down to the flip of a coin.
Imagine the possibility for corruption and nepotism and backroom deals.
I'd really like to see some simplification in this area before it goes bad.
The Arm NVidea acquisition is just as bad. Publicly announced over a year ago. Europe just opened an investigation. What have they been doing for a year? What happens when someone in that office let's drop that for 0.1% of the deal price he can make it happen, or they can wait another few years for a preliminary refusal?
[+] [-] klelatti|4 years ago|reply
Small countries have the right to control what happens in their own markets too.
> * Is not predictable. This and other deals have been approved in some jurisdictions but then refused in others. And without apparent reason why what is a monopoly in one place isn't in others.
Different countries have different laws.
> * Take very long periods of time (this deal was first announced on may 2020, didn't get provisional refusal until August 2021 and now is still uncertain).
It takes time to gather data etc.
> Imagine trying to run a company for 18 months while your existence and entire future is entirely down to the flip of a coin.
It's not the flip of a coin.
Atm / Nvidia is not great but the regulatory risk was entirely predictable and clearly Softbank was prepared to take that risk. Personally, I think it should be blocked and quickly.
[+] [-] iam-TJ|4 years ago|reply
https://www.gov.uk/government/news/cma-fines-facebook-over-e...
[+] [-] gigglesupstairs|4 years ago|reply
[+] [-] jsnell|4 years ago|reply
[+] [-] mohanmcgeek|4 years ago|reply
To say this needs to happen for all future deals is extreme.
[+] [-] readflaggedcomm|4 years ago|reply
[+] [-] mrkramer|4 years ago|reply
[+] [-] niffydroid|4 years ago|reply
[+] [-] jacquesm|4 years ago|reply
[+] [-] 3guk|4 years ago|reply
[+] [-] dalmo3|4 years ago|reply
[+] [-] ceva|4 years ago|reply
[+] [-] jacquesm|4 years ago|reply
[+] [-] aligray|4 years ago|reply