Acquire

Facebook buys GIPHY, cementing control over the spirit of social media

Monday, May 18, 2020 by Snacks
_Gettin' GIPHY Wit It_

Gettin' GIPHY Wit It

The "G" is hard... Mark Zuckerberg must have been blasting Will Smith's 1997 banger as he signed the papers to acquire GIPHY for $400M. The GIF-sharing platform will join Facebook as part of Instagram — its library of LOL-inducing moving images will be more deeply integrated into Insta as well as FB's other apps. FYI - GIPHY won't get banned from non-FB apps, like Twitter and Slack.

  • Ever wonder where all those GIFs come from? They're born in the GIPHY website — hundreds of millions of users contribute to this library with billions of looping vids.
  • GIPHY doesn't own the rights to the vids used in GIFs, so it makes money by showing sponsored results to searches (you search for "funny cow" and get a Dairy Queen GIF).
  • Experiment: Try searching for a "Lip Gloss" GIF on Instagram DM — A glossy mouth with Maybelline branding comes up as a top result.

What's in a GIF?... While FB says it acquired GIPHY to help people better "express themselves," 50% of GIPHY’s traffic already comes from Facebook's "family of apps" (Facebook, Instagram, WhatsApp, and Messenger) – 25% of that traffic comes from Insta alone. So it's gotta be something else...

THE TAKEAWAY

GIPHY is the secret sauce to Facebook's ad-reliant burger... Facebook and GIPHY are free, but make money by promoting sponsored content — Facebook does ad sales on a ginormous scale. By making GIFs a more prominent part of its apps, Facebook can make more $$$ from GIPHY's brand partners by exposing them to its 2.5B+ users.

  • GIPHY could be Facebook's Trojan Horse into every social and messaging platform: GIFs are already so ingrained into popular culture that FB's competitors can't drop them.
  • It's actually in Facebook's interest not to ice out competitors from GIPHY: Say you search for a "burger" GIF on Twitter — Facebook could potentially get paid to have In-N-Out be the top result fetched from GIPHY's site.
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