Congress Raises Antitrust Concerns Over Facebook’s Purchase of Giphy

Senators across the political spectrum raised concerns about Facebook’s $400 million acquisition of Giphy, a website for the creation and sharing of animated images, or GIFs. Although Facebook claims that “50% of GIPHY’s traffic comes from the Facebook family of apps,” Senators are wary of antitrust risks arising from this acquisition.

Facebook has faced antitrust scrutiny over the last few years, including multiple lawsuits. The most recent was brought by Reveal Chat in January. Late last year, the Federal Trade Commission indicated it may contest Facebook’s integration into some of its largest acquired companies, WhatsApp and Instagram.

Facebook said in a blog post on Friday that Giphy will retain its primary function as a GIF-making and sharing application, and that “developers and API partners will continue to have the same access to [its] APIs.” Despite this pledge for consistency, anticompetitive concerns have grown among several senators, including Sens. Josh Hawley (R-Mo.), Elizabeth Warren (D-Mass.), and Amy Klobuchar (D-Minn.).

In a statement to The Verge, Hawley said, “Just like Google purchased DoubleClick because of its widespread presence on the internet and ability to collect data, Facebook wants Giphy so it can collect even more data on us. Facebook shouldn’t be acquiring any companies while it is under antitrust investigation for its past purchases.” Also skeptical about this merger, Klobuchar said, “Many companies, including some of Facebook’s rivals, rely on Giphy’s library of shareable content and other services, so I am very concerned about this proposed acquisition.”

Klobuchar also told TechCrunch that “The Department of Justice or the Federal Trade Commission must investigate this proposed deal.”

In April, Democrats like Sen. Warren and Rep. Alexandria Ocasio-Cortez (D-NY) proposed halting large mergers during the ongoing pandemic. They also announced plans to introduce the “Pandemic Anti-Monopoly Act,” which would force a temporary prohibition of large mergers and acquisitions until the Federal Trade Commission (FTC) “determines that small businesses, workers, and consumers are no longer under severe financial distress,” according to NBC News.