Stock photography company Shutterstock has acquired Giphy for $53 million, following the UK competition regulator’s blockage of Meta’s attempt to acquire the popular GIF platform.
The acquisition price of $53 million is a significant discount compared to the reported amount Meta agreed to pay for Giphy in 2020. That same year, news website Axios reported the deal was worth about $400 million, while The Guardian disclosed that it was $315 million.
Regardless, the $53 million price tag is a bargain compared to Giphy’s highest valuation of $600 million in 2016. Also, as part of the agreement, Meta will continue to have access to Giphy’s library for use in its products.
What went wrong for Meta
Meta faced trouble with its acquisition of Giphy after the Competition and Markets Authority (CMA) ordered the Instagram parent company to reverse the deal in 2021.
The CMA expressed concerns that the acquisition could negatively impact competition by strengthening Meta’s market dominance, potentially allowing the tech giant to restrict rival companies’ access to GIFs or demand valuable user data in exchange for access. Despite appealing the decision, Meta ultimately agreed to sell Giphy last year.
Shutterstock on the other hand, believes the deal will augment its content library, which should now include GIFs and Stickers.
Paul Hennessy, CEO of Shutterstock says, “Through the Giphy acquisition, we are extending our audience touch points beyond primarily professional marketing and advertising use cases and expanding into casual conversations. We plan to leverage Shutterstock’s unique capabilities in content and metadata monetization, generative AI, studio production and creative automation to enable the commercialisation of our GIF library as we roll this offering out to customers.”
According to Shutterstock, Giphy currently has an impressive user base of 1.7 billion daily users, along with 15 billion daily media impressions and 1.3 billion daily search queries.
The CMA recently opposed two notable acquisitions, including Meta’s purchase of Giphy. The other is Microsoft’s attempt to acquire Activision Blizzard, which the CMA rejected due to concerns about potential competition issues in the emerging cloud gaming market. Microsoft has since said it will appeal the decision.