Done Deal – Google Buys YouTube – It's 2000 All Over Again

Posted by

What’s that saying: “always believe the rumors”? It was just announced that Google has agreed to purchase YouTube for 1.6 billion in stock.
CNN continues:
“YouTube, which was founded in February 2005, has quickly become the most well-known of several online video sites. More than 100 million videos, many of which are short videos created by the site’s users, are downloaded a day on the site.
According to Internet research firm Hitwise, YouTube has about a 46 percent share of the online video market.
For Google, the purchase of YouTube gives the company the ability to tap into the potentially lucrative online video and social networking markets. Some analysts have criticized Google for relying too much on advertising tied to keyword searches.”
Does this bring back memories of 2000 when Time Warner bought AOL for one hundred billion dollars? Maybe a little… it’s not like YouTube is delivering a clear profit model or revenues that any of us can explain. But here’s why it does make sense: Google is watching what we’re searching for and they’re buying companies that can deliver after the search has been completed. Fact is, we’re searching for video… lots of it, so Google capitalized on it and bought YouTube.
Read more here: CNN – Google To Buy YouTube For $1.65 Billion.

One comment

  1. Great post Mitch!
    I hadn’t thought of that angle from Google’s standpoint. It’ll be interesting to see what they buy next.
    Talk about access to great market research!
    Kevin Behringer
    Whitewater, WI

Comments are closed.