Talk about a fire sale. With limited interest in GIF platforms and UK regulators forcing a sale, Meta has decided to sell Giphy to Shutterstock for a mere $53 million. After purchasing it for $315 million in 2020 and subsequently being ordered to sell it by the UK’s Competition and Markets Authority (CMA), Meta has been challenged to find a suitable Giphy buyer at a time when GIFs are perceived to be less trendy than three years ago. The GIF library has found a fitting future owner in Shutterstock, but for Meta, it means a $262 million loss.
The deal
Shutterstock announced today its definitive agreement to buy Giphy for $53 million, seven months after Meta said it would accept the CMA’s ruling that it must divest Giphy. Shutterstock said the deal is expected to close in June and is “subject to customary closing conditions.”
The deal should assuage trepidation from Giphy, which encouraged the CMA to enact behavioral ordinances rather than force Meta to sell Giphy. The animated images company feared GIFs just weren’t as cool as they were in 2020, and so the platform would mostly attract “weak or inappropriate” suitors.
“User sentiment towards GIFs on social media shows that they have fallen out of fashion as a content form, with younger users in particular describing GIFs as ‘for boomers’ and ‘cringe,’” Giphy told the CMA in August.
Giphy urged the CMA, which had to approve Meta’s Giphy sale, to wait for a buyer with “industry knowledge and experience managing a group of young tech engineers, product managers, and staff.”
Shutterstock gettin’ Giphy wit it
It’s unclear how “young” Shutterstock’s team is, but Giphy’s library will at least be an appropriate inclusion in the stock image provider’s library. Meanwhile, Shutterstock hopes to expand more into consumers.
Shutterstock plans to incease its API ecosystem with Giphy’s 14,000-plus API/SDK integrations. It will gain 1.7 billion daily users implementing more than 1.3 billion searches daily and generating 15 billion daily media impressions, including across the Giphy website and app, today’s announcement claimed.
The New York City-headquartered company will also add new partners, since Giphy is integrated with business platforms like Microsoft Teams and Slack and social media ones like TikTok and SnapChat. Meta has also signed a deal to continue leveraging Giphy’s API.
Further, Giphy has partnered with media entities, including Disney, NBC, and Netflix, and sports leagues, like the NFL. Shutterstock hopes to use these to grow its marketing and advertising potential by getting consumers to use relevant GIFs and stickers in “casual conversations,” Shutterstock CEO Paul Hennessy said in a statement.
“We plan to leverage Shutterstock’s unique capabilities in content and metadata monetization, generative AI, studio production and creative automation to enable the commercialization of our GIF library as we roll this offering out to customers,” he said.
According to CNBC, Shutterstock shares rose almost 2 percent during Tuesday’s morning trading.
