Facebook to Acquire GIF-giant Giphy in A Major Tech Buy-Out

There have not been major acquisitions in the tech space in recent times due to the impact of the COVID-19. However, that seems to be changing, with a significant announcement coming from Facebook yesterday. Facebook has decided to acquire the GIF-giant Giphy in a bid to control the GIF industry. Here’s a look at what the acquisition will mean for Facebook and its competitors.

Facebook Buys Giphy

Facebook’s acquisition of Giphy can change the way we send and receive GIFs forever. Studies have shown that over 700 million people use Giphy to send and receive short video content daily. Most of this happens over popular social media apps such as Twitter, TikTok, WhatsApp, and iMessage. All these applications make use of Giphy’s API to send others GIFs and other such content. An issue will arise because of these companies will not want to integrate with a Facebook platform. Since Facebook has had notorious privacy issues, they would prefer not to utilise Facebook-owned platforms for their content. Also, Facebook’s reliability has taken a big hit due to frequent bugs, crashes, and upgrade issues. 

Moving Forward

However, Facebook has made it clear that developers will be able to utilise Giphy even after the acquisition. Instagram VP for product, Vishal Shah remarked that users will still be able to use Giphy to send and receive content. Further, Giphy’s in-house team will also continue to create and upload new GIFs. Furthermore, the GIFs do not contain any cookies or tracking mechanisms, meaning people do not have to worry about privacy. Giphy has also confirmed that the app can view only search terms, and not any of the data stored on your phone. However, many experts worry that after the acquisition, Facebook can change how the company works. Therefore, a lot of applications that now use Giphy could drop the service after the big buy-out. 

Major Applications Which Use Giphy

Here’s a look at some of the world’s most popular apps that make use of Giphy. 

iMessage: The #images application, which is pre-built into the iOS, allows users to send GIFs via the iMessage. However, the integration with Facebook could lead to some tension between Apple and the social media giant. Apple has strong privacy norms, which they will not like to dilute, which can lead to them stopping their collaboration with the GIF company. 

MailChimp: MailChimp, which is one of the world’s most used email marketing, and mailing list software, allows users to add GIFs into emails. Reports state that the company will continue offering this service, even after the buy-out. This does not come as a surprise as the company already had some Facebook integration built into their software.

Signal: Signal sources a lot of their GIFs from Giphy, and also allows users to add GIFs to their messages. Since it is a privacy-focused messaging application that provides end-to-end encryption, we are unsure whether they will continue this service post-acquisition. Even if they do, due to their high-security measures, Facebook might not be able to access any data. 

Slack: Slack also allowed users to add GIFs into their messages and chats while using the messaging app. Their VP, Brian Elliot, released a statement that Giphy had information only about GIF searches, and hence, privacy would not become a pressing concern. 

Snapchat: Snapchat added a Giphy integration in 2018, and has not yet decided whether it will continue to allow the union to function. 

Telegram: Telegram, coupled with Giphy to allow users to add GIFs to their messages. The application also confirmed that Giphy receives no information regarding the users who utilise Telegram. Therefore, they were not concerned with privacy issues. However, they are in plans to transition away from their dependence on Giphy. 

TikTok and Tinder: TikTok allows you to send GIFs and stickers through Giphy. However, they have not released any comment regarding the future of this partnership after the acquisition. Tinder, too, has refused to comment on the issue. However, since both these apps allow users to log in using their Facebook account, in most likelihood, the union will continue. 

Twitter: Twitter makes use of both Tenor and Giphy to source their GIFs. Since Twitter and Facebook have a running feud, it is highly likely that the company will now depend entirely on Tenor for their GIFs. 

The deal is reportedly said to cost somewhere around $400 million, and once in place can have a lot of implications to the way we send and receive GIFs. We will have, however, have to wait and see how the deal plays through, and how these companies react to the acquisition.