Meta sold GIPHY to Shutterstock, suffered a loss of 347 million USD

Shutterstock announced it will buy the largest animation platform GIPHY from Meta for $53 million in cash. The deal is a significant loss for Meta, as the social media giant previously spent $400 million to buy the New York-based Giphy in 2020.

This is the latest development after a year after the UK Antitrust Authority (CMA) ruled that Facebook (Meta’s predecessor) must sell the animation sharing platform Giphy because the acquisition reduces competition. competition between social networks and negatively impact advertisers.

The CMA believes that Meta’s acquisition of GIPHY will limit the choice of social media users in the UK. In addition, Meta’s monopoly on GIPHY may change the terms of access for self-interest, for example requiring TikTok, Twitter or Snapchat to provide more user data.

GIPHY has a collection of over 7 billion animated GIFs and stickers, which drive more than 1.3 billion search queries daily. GIPHY delivers over 15 billion media impressions daily.

Shutterstock CEO Paul Hennessy said: “This is an exciting next step in Shutterstock’s journey as a holistic creative platform.”

After the deal was announced, with a high probability of completion next month, Shutterstock’s share price increased by 4%. The company says GIPHY will add a minimum revenue this year and will begin efforts to increase revenue from 2024.

Reportedly, Meta will enter into API agreements with Shutterstock so that it can continue to use GIPHY on its platforms. Meta has been a user of GIPHY’s API for many years on Instagram, Facebook, Messenger, and WhatsApp. The company acquired GIPHY specifically to be part of Instagram, where many people use GIFs to create their own images.