Facebook fined £50.5m for breaching order in Giphy takeover investigation

https://www.theguardian.com/technology/2021/oct/20/facebook-fined-for-breaching-order-in-giphy-takeover-investigation

by ljf • 5 years ago

104 35 5 years ago

theguardian.com

streamofdigits2• 5 years ago

How many hours of ad revenue does this translate to?

reustle• 5 years ago

In 2020, Facebook's advertising revenue worldwide amounted to 84.2 billion U.S. dollars

= Roughly 61,196,981,000 GBP

= Roughly 167,600,000 GBP per day

So, roughly 8 hours?

streamofdigits2• 5 years ago

Just another day in the life...

coz131• 5 years ago

Acquisition was 290m pounds so 50.5m isn't that high. Probably should be in the 30% at least.

vlovich123• 5 years ago

If you break your word about an acquisition, make it the cost of the purchase + 100% of any value that acquisition generated (a good rule of thumb would be ~10x the amount of money spent on supporting that BU or the total amount of revenue, whichever is higher).

Seems like everyone is concerned about moral hazards for normal crimes yet white collar crimes like this are extremely underpunished to the point that you can factor that fine into your P&L.

dane-pgp• 5 years ago

"The law, in its majestic equality, forbids the rich as well as the poor to sleep under bridges, to beg in the streets, and to steal bread."

prasadjoglekar2• 5 years ago

That price was for a global deal, not just the UK. 50.5M is likely higher than Giphy's UK revenues for a year. It does seem punitive.

TFA also says that Austria fined FB ~10M for the same deal.

It might all have been priced into the deal as some other comments have pointed out. If the goal is to truly deter, then the CMA should perhaps make FB unwind the deal at least in the UK.

klelatti3• 5 years ago

Isn't the point here that they've already integrated the business - otherwise why not just comply with the disclosure requirement?

Also not sure that we can measure the value to Facebook in this way. This is about strengthening Facebook's core business which is worth (just guessing) > $500bn. How much value it adds is unknown but I bet it's a lot more than the acquisition price.

klelatti3• 5 years ago

This is Facebook acting as though they are above the law.

The next time they attempt a takeover this should be rolled out as evidence of their likely behaviour and should be grounds for blocking that takeover.

If you won't play by the rules then you don't get to play at all.

Edit: Someone should ask Nick Clegg, a former UK lawmaker, why it's ok to break the law in that country.

andylynch• 5 years ago

Almost certainly - it's worthing bearing in mind the CMA fined them 155x the previous record for this kind of penalty.

The investigation also appears to be ongoing; I would expect the final decision to also be substantial.

kwertyoowiyop2• 5 years ago

How about: “acting because they are above the law”?

9387367• 5 years ago

priced in

axiosgunnar• 5 years ago

I suggest that these newsarticles be rewritten like this:

„Facebook fined 8 hours of revenue for breaching order in Giphy takeover investigation“

acatton• 5 years ago

I've never understood why people focus so much on revenue. "My company has a 2M$ ARR." All right, good for you, but if you're spending 2.5M$ per year to run your company, it looks like a crappy business to me...

I would suggest something more like "Facebook fined 15 hours of profit for breaching order in Giphy takeover investigation"

yunohn• 5 years ago

On the contrary, I don’t understand why you’re focusing on profit.

It’s quite public knowledge that most companies avail accounting practices to lower profit over revenue. In fact, it’s not even a trick - investing profits back into your business is common sense.

BiteCode_dev• 5 years ago

Because in order to avoid paying taxes, a lot of companies balance books so that no profit emerges.

pessimizer• 5 years ago

Media outlets have a severe allergy to placing numbers in context, no matter who begs them to. They just want the number to look big.

For decades I have harangued reporters about writing down really big numbers, most often budget numbers, without providing any context that would make them meaningful for their audience. Even though leading news outlets, like the New York Times (NYT), Washington Post (WaPo), and National Public Radio (NPR), have well-educated audiences, most readers/listeners have no idea what $250 billion, or some other huge sum, over the next decade means. (Often the time period over which money will be spent is not even specified in a piece – it does matter.)

https://cepr.net/the-new-york-times-big-deficit-numbers/

The Times Is Working on Ways to Make Numbers-Based Stories Clearer for Readers By Margaret Sullivan - October 18, 2013 2:46 pm

https://publiceditor.blogs.nytimes.com/2013/10/18/the-times-...

woliveirajr• 5 years ago

Remembers me this extension: https://dictionaryofnumbers.com/ (for Chrome, don't know about other browsers).

Not sure it would have give the correct context (i.e., Facebook value) but would give swome context.

bryanrasmussen• 5 years ago

They just want the number to look big.

yes but on the other hand if they combined it with the hours of revenue you would have a big number that looks impressive being dwarfed by the realization of how big and scary that means Facebook is.

Throwawayaerlei• 5 years ago

Media outlets have a severe allergy to placing numbers in context, no matter who begs them to.

Maybe they're lazy?

And no matter how "well-educated" their audiences are, a very large fraction of them and their audiences are innumerate, it's hard to get across the message you desire.

JumpCrisscross• 5 years ago

Facebook fined 8 hours of revenue for breaching order in Giphy takeover investigation

This juxtaposes a local fine on a subsidiary to a conglomerate's global revenue. That's fine. It's revealing, in some ways. But it's more clickbait than the actual fine.

mattbee• 5 years ago

“This should serve as a warning to any company that thinks it is above the law,” said Joel Bamford, a director of mergers at the CMA.

Like some people have said - 8 hours of revenue. I think it confirms that breaking the law in the UK is excellent value for money!

amelius• 5 years ago

They should lose their trademarks and domain names after three offenses.

system16• 5 years ago

"Pay them. In the scheme of things, it's a[nother] speeding ticket."

kwertyoowiyop2• 5 years ago

Facebook: Places £50m bill on the nightstand. “Buy yerself sumthin’ nice.”

znpy• 5 years ago

£50.5m is nothing when compared to Facebook's gross earnings.

It should be at least £500m.

harles• 5 years ago

I really wish this article had more detail. Maybe there are legal filings somewhere with them, but this leaves a lot to the imagination as to what the non-compliance was:

The regulator said Facebook significantly limited the scope of the updates it was meant to provide proving it was complying with the order despite repeated warnings.

Facebook fined £50.5m for breaching order in Giphy takeover investigation

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