A glimpse of Twitter after Jack Dorsey, European telecoms want Tech giants to bear some costs and other notable stories from this week
Welcome to “#SocialStocks,” The Fly’s weekly recap of Wall Street’s reactions to social media stock news.
ANTITRUST LATEST: The U.K.’s Competition and Markets Authority has found that the merger between Facebook (FB) and Giphy “has resulted or would result in a substantial lessening of competition in social media and display advertising, harming social media users and businesses.” The agency has decided that the only effective way to address the competition issues is for Facebook to sell Giphy, in its entirety, to a suitable buyer. In order to address the substantial lessening of competition it has found, the Competition and Markets Authority decided to require Facebook to sell Giphy, in its entirety, to a suitable purchaser. The 16 page report discussed a number of horizontal and vertical effects of the merger, while examining several pieces of evidence. In the end, the CMA concluded the following:
The completed acquisition by Facebook of Giphyhas resulted in the creation of a relevant merger situation.
The Merger has resulted or may be expected to result in an SLC: in the supply of display advertising in the UK due to horizontal unilateral effects arising from a loss of dynamic competition, and in the supply of social media services worldwide due to vertical effects resulting from input foreclosure.
Due to the multi-sided nature of the markets in which the Parties operate, a lessening of competition in the supply of social media services also has effects on competition in the supply of display advertising. The vertical effects resulting in a loss of competition in social media that the CMA has highlighted therefore exacerbate the effects on competition in display advertising arising from the elimination of a potential competitor.
In order to address the SLCs that we have found, the CMA has decided to require Facebook to sell GIPHY, in its entirety, to a suitable purchaser.
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