Regulation efforts against Big Tech are gearing up, but is it too late to rein in the tech giants?
The UK’s competition watchdog ordered Facebook, now Meta, to sell gif image company Giphy in its first major clampdown on Big Tech mergers and acquisitions, but such action comes too little, too late.
On Monday, the UK’s Competition and Markets Authority (CMA) showed the first signs of its pledge to slow down Big Tech’s power over the digital marketplace as the tech giants continue to gobble up competitors and innovators.
In a landmark ruling for the CMA, Meta has been ordered to sell Giphy Inc due to the potential to monopolise its GIFs, the animated images ingrained in texting, posting, reacting and living online today.
Facebook (now Meta) bought Giphy in a $400 million (£302m) acquisition last year, and while the CMA’s decision to unravel the acquisition over concerns that Meta would deny or limit rivals’ access to Giphy GIFs to bolster Meta-owned sites like Facebook, WhatsApp and Instagram is welcome, it is nevertheless frustrating.
It is, after all, action that might have been infinitely more welcome when Big Tech embarked on a slew of takeovers in the mid-2010s, allowing them to reshape the internet in their image and restructure the digital market in their interest.
From Facebook’s acquisition of WhatsApp and Instagram, to Alphabet (Google) buying up YouTube and Artificial Intelligence firm DeepMind, there were ample opportunities to stop Big Tech in its tracks that passed oblivious regulators and legislators embracing big business by.
We’re now seeing efforts to repair the damage, with California tech giant Nvidia’s planned purchase of UK-based computer chip producer ARM coming under considerable scrutiny from US, UK and European regulators trying to curb Big Tech’s power with the EU’s Digital Markets Act and CMA’s creation of a pro-competition Digital Markets Unit.
And rightly so.
Nvidia’s $40 billion (£30bn) vertical integration acquisition of ARM gives it ample power over the semiconductor chip market, plagued by supply shortages and skyrocketing prices, just as Meta’s acquisition of Giphy would let it control the billions of GIFs created and exchanged on the site, who can access them and for what price.
But it’s hard not to think of what could have been had regulators stepped up sooner to stop Big Tech’s centralisation of the digital world, rather than wait until years after the horse has bolted to try and shut the doors.