In 2020, Meta purchased the main supplier of animated gifs, Giphy, for $400 million. Just three years later, they have now sold the company to Shutterstock for $53 million.
As the main supplier of animated gifs across social networks including TikTok, Twitter and Snapchat, Giphy receives more than 1.3 billion search queries every day. Gifs, or short looping videos, have become a highly popular tool online, so it is no wonder why Meta wanted to get involved.
Why Did Meta Sell Giphy?
Britain’s Competition and Markets Authority (CMA) opened an antitrust investigation in 2020 over concerns Meta’s ownership of Giphy would result in “substantial lessening of competition” in the UK market for short looping videos. The UK watchdog found that Meta’s purchase would hurt social media users and advertisers by stifling competition for similar content and equally boosting traffic to Meta-owned sites WhatsApp, Instagram and Facebook, while limiting access for alternative platforms to gifs.
In 2021, the country’s competition watchdog ordered Meta to reverse the deal. This was the first time that a regulator had blocked a deal by a big Silicon Valley company.
By September 2022, Meta made an appeal to the CMA but this appeal was lost. As a result, Meta accepted the CMA’s order in October and agreed to sell Giphy.
Shutterstock Acquire Giphy
Shutterstock has stated they are excited to acquire Giphy. The chief executive of Shutterstock, Paul Hennessy, told the BBC: “Giphy enables everyday users to express themselves in memorable ways with gif and sticker content, while also enabling brands to be a part of these casual conversations”.
The Giphy library is powered by individual artists contributing content alongside big companies such as Disney. Giphy is therefore able to keep a steady stream of relevant content that can be inserted into daily conversations and shared by social media users around the globe.
