trying to make money off the GIF is one that goes back to the earliest days of the internet.

The graphics interchange format was invented by this guy in 1987.

He, by the way pronounces it "Jif."

It wasn't long before people try to use this technology for business.

The biggest operation was a website called Animation Factory which produced

and sold GIFs of every imaginable variety.

"It seems like they set out to try and animate the entire world, starting with

the most arcane and bizarre ideas they could think of."

That's Alex Goldman he's the co-host of one of my favorite podcasts called Reply All

He recently ran a story about Animation Factory's rise in the late '90s.

"I gotta say my favorite is: there is a faceless man and he sort of wriggling

and floating above him as a UFO."

"There are tens of thousands the owners say that there's something like half a

million GIFs on the site."

"It's just a an insane insane amount."

"There was a time on the internet when these animated GIFs

wre the thing you would decorate your website with. There was no aesthetic for the internet."

Who knows who needed this image of a guy with an automatic hammer machine

but someone did and Animation Factory was there to make it.

"The business model of Animation Factory was if if there's something that someone may

have wanted one of, we're going to make 15 of that thing."

"amazingly that was a viable business strategy in like the late 90s early 2000s."

Alex said that he heard from someone who was on the board of the

company that owned Animation Factory in the early two thousands.

"He told me that animation factory in at a day was making about 2 million dollars a year in profits."

"I mean the internet of the late nineties and early two thousands was a pre blog world.

"it was before the internet had templates that allowed people to easily make

attractive-looking blogs."

But the internet matured and by the

mid 2000s, web design was informed by professional standards. Blogs showed up

with their standardized templates and GIFs lost their place as the design

elements and place holders on the web.

then something started happening around the late 2000s that would pave

the way for a GIF renaissance: Bandwidth improved and people started making GIFs

out of existing video content, not for web design purposes but solely as a mode of expression

the rise of places like Tumblr and Reddit meant there were more places to put

these little bite-sized expressions. GIFs were back.

The gift Renaissance also spurred on some huge business ventures surrounding

the potentially lucrative GIF economy

"We're biologically wired for visual consumption and communication."

That's Adam Leibsohn, the chief operating officer of Giphy which is the biggest of

the new GIF companies. They're basically a GIF search engine and they plan to

make money by partnering with huge brands to create GIFs of that brands

content that people can share in their day-to-day communication.

"So, traditionally an advertiser would have to spend a lot of money to get

their message through the market and they're using all this stuff to

interrupt your experience and they're just hoping that like that message will

sink in. And we're making it a bottom-up approach in that we're making this

content accessible and expressive. People are taking those branded objects--that

piece of Game of Thrones, that clip of Seinfeld, and they're sending it to their

friend. Instead of the brand shoving the message on somebody's throat, people are

the ones being the brand ambassadors. They are self identifying with the content

because they selected it

they're endorsing it because they sent it to you and you're both bonding over it

emotionally because you're using it to communicate."

So while you might send a GIF of Zach Braff expressing exactly what you need

to tell a friend, Hulu sees this as advertising for their show scrubs.

If advertisers looking for "engagement" with their content

it doesn't get much better than this. Big production studios see this is a way of

sneaking little advertisements in to your email and text feeds and they may

be willing to pay big bucks for partnerships with places like Giphy.

But as of now there are no paid gifts on the site and Giphy says that they don't

have specific plans on if or how they will mark sponsored gifts as advertisement

For now they seem to be focused on making GIFs ubiquitous and accessible

on every communication platform

"You can't buy an ad inside of our iMessage

conversation that's just never gonna happen."

'And venture capitalists seem to think that this is a safe bet as well: Giphy is

valued at 300 million dollars even though doesn't even make money yet.

"Everyone searching for content anyways, everyone searching for expressive

content: hello goodbye how are you

they're really searching for that content translated or sort through the

lens of whatever is the cultural phenomenon of the moment whether it's

Game of Thrones or some other new movie or some other big TV show. From an

advertising standpoint what we're suggesting is we should be doing more."