Meta, the parent company of Facebook and Instagram, has recently announced the sale of its GIF platform, Giphy, to Shutterstock for a relatively low price of $53 million. This decision marks a significant loss for Meta, as it had acquired Giphy for $315 million in 2020.
The sale of Giphy at a reduced price can be attributed to several factors, including increased regulatory pressure from UK authorities, particularly the Competition and Markets Authority (CMA), which aims to address anti-competitive practices in the market. Additionally, public interest in GIFs has diminished since Facebook's acquisition of Giphy, with users, especially younger demographics, describing GIFs as outdated and cringeworthy.
Meta initially viewed the acquisition of Giphy as a favorable deal in 2020. However, as public interest waned, finding a buyer willing to pay even half of its previous value proved challenging for the company. Nevertheless, the acquisition by Shutterstock, a remote-working company operating in a similar industry, holds promise for Giphy's future.
Shutterstock recently made an official announcement regarding its acquisition of Giphy, following a seven-month process during which Meta complied with the Competition and Markets Authority's divestment ruling. The completion of customary closing conditions is expected in June, finalizing the deal between Shutterstock and Giphy.
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