In a surprising turn of events, Meta, the parent company of popular social media platforms like Facebook, Instagram, and WhatsApp, has sold the animated-GIF search engine Giphy to Shutterstock for $53 million.
This comes just three years after Meta acquired Giphy for a hefty sum of $400 million.
The sale was prompted by the UK’s competition watchdog, the Competition and Markets Authority (CMA), which insisted on the divestiture to address concerns of anti-competitive practices in the social media and advertising markets.
Giphy, widely known as the leading provider of animated gifs for social networks such as Snapchat, TikTok, and Twitter, will still be accessible to Meta platforms as part of the deal.
This article explores the issues surrounding the sale of Giphy, the implications for social media users, and the motivations behind this significant transaction.
Issues Surrounding the Sale of Giphy
Giphy, often dubbed as the world’s largest collection of gifs and stickers, is an integral part of online communication, enabling users to express themselves creatively and effectively.
Each day, Giphy handles an astounding number of search queries, receiving over 1.3 billion requests.
Moreover, its content is viewed an astonishing 15 billion times, demonstrating the immense popularity and usage of animated gifs in today’s digital landscape.
As Meta acquired Giphy in 2020, it expressed intentions to make the platform accessible to other social networks. However, the CMA intervened, asserting that the acquisition would result in detrimental effects on competition within the social media and advertising industries.
The CMA’s Investigation and Meta’s Response
The sale of Giphy faced regulatory scrutiny from the CMA, which issued an order in November 2021, demanding its divestiture.
This marked a significant moment, as it was the first time the UK regulator had blocked a deal involving a major Silicon Valley company.
Meta appealed against the CMA’s decision, arguing that gifs had lost their appeal, especially among younger users who considered them outdated and cringe-worthy.
However, the investigation revealed that Giphy still played a crucial role in facilitating communication across various platforms, making it an important asset for social media networks and advertisers alike.
Ultimately, Meta accepted the CMA’s order to sell Giphy in October, albeit with disappointment.
Giphy Acquisition by Shutterstock
Shutterstock, a leading provider of stock photos, videos, and music, expressed excitement in acquiring Giphy.
The CEO of Shutterstock, Paul Hennessy, highlighted the platform’s ability to empower everyday users and brands alike. Giphy’s extensive library of gifs and stickers is primarily fueled by contributions from individual artists and major companies such as Disney and Netflix.
This ensures a constant stream of up-to-date and relevant content that can be seamlessly integrated into everyday conversations and shared across social media platforms.
With the acquisition, Shutterstock aims to tap into Giphy’s expansive user base and leverage its unique content to enhance its offerings and engagement capabilities.
Impact of Giphy sale
The sale of Giphy by Meta to Shutterstock will have several impacts. Firstly, it will foster increased competition within the social media and advertising markets.
With Giphy being made available to other social networks, there will be a greater opportunity for these platforms to integrate animated gifs into their services, enhancing the user experience and potentially driving innovation in content creation.
This increased competition may result in improved features and offerings from different social media platforms, benefiting users in terms of more diverse and engaging content options.
Secondly, the accessibility of Giphy’s library of gifs and stickers will remain intact for Meta’s platforms, including Facebook, Instagram, and WhatsApp. This means that users of these platforms will still be able to enjoy and utilize Giphy’s content seamlessly, ensuring continuity and familiarity in their digital communication experiences.
The retention of Giphy’s content within Meta’s ecosystem may help maintain user engagement and satisfaction on these platforms.
Thirdly, the acquisition of Giphy by Shutterstock opens up new opportunities for the platform.
Shutterstock, a major player in the stock photo and video industry, can leverage Giphy’s extensive collection of gifs and stickers to enhance its offerings and engagement capabilities.
This may lead to the integration of Giphy’s content into Shutterstock’s existing services, providing its customers with a wider range of visual assets for their creative projects.
Additionally, Shutterstock’s expertise and resources can potentially contribute to the growth and development of Giphy, ensuring a continued supply of high-quality and up-to-date content for users across various social media platforms.
Overall, The sale of Giphy by Meta to Shutterstock for $53 million marks a significant shift in the animated-gif landscape. Despite having paid $400 million for Giphy just three years prior, Meta was compelled to divest the platform due to concerns raised by the CMA regarding competition in the social media and advertising markets.
Giphy’s immense popularity as the primary supplier of animated gifs to major social networks demonstrates its vital role in online communication.
The acquisition by Shutterstock presents new opportunities for the platform, enabling it to reach a wider audience and leverage Giphy’s rich library of creative content.
As Giphy continues to evolve under new ownership, it remains a dynamic tool for users to express themselves and engage in vibrant digital conversations.
This is it for the day,
We hope this article has provided you with valuable insights.
If you found it informative, please consider sharing it with your friends and colleagues who may also be interested in this topic.
we are part of the economy hut core content, we like to make the content which is easy to read and understand to any reader who is having curiosity about the economical issues, we are always open for all the suggestions, criticisms, etc. From all the readers. Let us understand the economy in an easy manner.