Meta has found a buyer for Giphy, the animated GIF search engine it acquired almost three years ago for $400 million.
In an announcement today, Shuttershock confirmed it was purchasing Giphy in a cash transaction that “consists of $53 million of net cash paid at closing.”
The deal is expected to close next month, with Meta signing an agreement to ensure its platforms get continued access via integrations to Giphy content.
Why Did Meta Put Giphy Up For Sale?
Make no mistake, Meta is reluctant to offload Giphy. It warned that the GIF search engine would struggle to survive as an independent business, and had previously highlighted that there wasn’t much interest in potential buyers.
However, in the end the tech conglomerate had little choice but to sell. Meta first acquired Giphy back in November 2021, but the sale was blocked from completion by the UK’s competition regulator, the Competition and Markets Authority (CMA). The grounds for this legal action stated that the merger reduced dynamic competition.
Meta’s subsequent appeal processes have held up a ruling for the past several months, and it’s only now that the UK’s antitrust authority has issued a final order for the sale.
Are GIFs Not Cool Anymore?
Meta’s “last-ditch appeal” to the CMA to stop a forced sale from going through was seemingly a low blow to the art form that is a GIF. The company stated that GIFs are “cringe,” “for boomers,” and are no longer a relevant form of content, having fallen out of fashion with younger users.
Even Shutterstock is accepting that the acquisition isn’t going to make huge creative waves, with them acknowledging the minimal revenue the deal is likely to bring in. However, it’s a step in the right direction with regard to bolstering their creative offering:
“[It’s] an exciting next step in Shutterstock’s journey as an end-to-end creative platform. Through the Giphy acquisition, we are extending our audience touch points beyond primarily professional marketing and advertising use cases and expanding into casual conversations.” – Paul Hennessy, Shutterstock Chief Executive.
As well as strengthening its creative suite, the deal may also help to speed up Shutterstock’s moves into generative AI and its burgeoning metadata strategy.