Back in 2021, the UK government ordered Meta to sell Giphy, and now the buyer has been announced. It’s Shutterstock, the famous stock photo company, which agreed to buy Giphy from Meta for $53 million.
[Related reading: UK orders Meta to sell Giphy, and it’s final]
A bit of backstory
In 2020, Meta (then still Facebook) acquired Giphy to integrate its collection of GIFs into its platforms including Instagram, Facebook, and WhatsApp. However, the UK’s Competition and Markets Authority (CMA) began investigating the acquisition to determine if it would harm competition. This ended up in the CMA ordering Meta to sell Giphy, and it was the final order. In addition, the CMA fined Meta $69.6 million for proceeding with the merger without the regulator’s approval.
The ruling was based on the idea that Meta’s ownership of Giphy limited choices for social media users in the UK. 73% of the time users spent on social media in the country already was on Facebook and other platforms under its wing. So, Meta owning Giphy would further push people towards using Meta-owned platforms, according to the CMA. What’s more, the CMA concluded that Meta’s ownership of Giphy would pose a risk to innovation in the UK’s display advertising market.
Selling Giphy to Shutterstock
According to a press release, Shutterstock bought Giphy from meta for $53 million. Shutterstock believes that acquiring Giphy will only make things better. Shutterstock is in the business of helping people and brands tell their stories,” said the company CEO Paul Hennessy. “Through the GIPHY acquisition, we are extending our audience touch points beyond primarily professional marketing and advertising use cases and expanding into casual conversations.”
The sale is expected to be completed in June. Additionally, Shutterstock will gain access to Giphy’s partnerships with companies like Microsoft, TikTok, and Twitter. This purchase will also support Shutterstock’s generative AI strategy, particularly on mobile devices, and help the company connect with more advertisers.
What will change for you?
Speaking Engadget, a Meta spokesperson argued against the CMA’s decision, stating that Giphy doesn’t operate in the UK and doesn’t qualify as display advertising. Meta believes that both Giphy and its users are better off with the resources and support the company provides. But still, the decision is irreversible.
The good news for users who love flooding Facebook and Instagram comments with GIFs is that this acquisition will not change anything for them. However, if you use Shutterstock, you probably will see some changes there, both as a creator and as a buyer. But we’ll cross that bridge when we get to it.