Google in talks to buy YouTube. Price tag? $1.6 billion

[Mellyrose]

http://money.cnn.com/2006/10/06/news/co ... 2006100612

Report: Google in talks to buy YouTube
Search engine declines comment on story that it's discussing deal to acquire video-sharing site for around $1.6 billion.
October 6 2006: 12:30 PM EDT

NEW YORK (CNNMoney.com) -- The online search giant Google Inc. is in talks to purchase the closely held Web sharing sensation YouTube for around $1.6 billion, according to a report published Friday.

Citing a person familiar with the matter, The Wall Street Journal reported that the companies are currently holding talks, but that discussions are at a sensitive stage.


"We do not comment on rumors and speculation," Google spokesman Jon Murchinson told CNN.

YouTube, based in San Mateo, Calif., allows viewers to upload and share video and it estimates that over 100 million videos are watched everyday .It has been speculated that the privately held company would be sold or taken public - although one critic, Internet start-up developer Mark Cuban, was quoted as saying anybody who buys YouTube "is a moron."

While the company has been criticized for allowing users to post copyrighted material on its Web site, YouTube inked a partnership with Warner Music Group (down $0.01 to $26.44, Charts) last month to distribute music videos and artist interviews.

The respected Silicon Valley blog Techcrunch first reported rumors of Google-YouTube deal earlier today.

Google (up $1.45 to $413.26, Charts) shares were slightly higher in midday trade on the Nasdaq exchange as were shares of rival Yahoo (up $0.14 to $25.32, Charts).

[PhilDernerJr]

It's just wild watching these internet sites get bought out like that, just like MySpace.

As for the video site, I am surprised that it hasn't happened sooner. Internet speeds have been climbing the past couple years, and after all the MP3 music sharing mania that happened a few years ago, video was the next step.

How long has YouTube actually been around? A year and a half or something? Imagine making a video site a in a very BASIC datbase fashion....and having more than a billion dollars 18 months later. Amazing.

[moose135]

How long has YouTube actually been around? A year and a half or something? Imagine making a video site a in a very BASIC datbase fashion....and having more than a billion dollars 18 months later. Amazing.

So, Phil, how much do you think you will get for NYCA? :D

[PhilDernerJr]

Rupert Murdoch nor Richard Branson hasn't offered me anything yet. ;)

[Matt Molnar]

How long has YouTube actually been around? A year and a half or something? Imagine making a video site a in a very BASIC datbase fashion....and having more than a billion dollars 18 months later. Amazing.

Yeah, it's crazy. YouTube has some issues though....bandwidth for all that video (100 million clip-views PER DAY) is estimated at over $1 million a month. And the big one: even with better self-policing, something like 90% of their content is stolen, and that won't be allowed to continue forever. I'm also surprised that Google is giving up on their own video product which they spent a lot of coin on so soon, even though it is clear that they have a fraction of the traffic of YouTube.

[PhilDernerJr]

Yes, I get emails regularly from people who noticed that my plane videos have been stolen and posted there.

Bandiwdth is an ass-kicker when it comes to video. It adds up faster than people realize. I think it's something like one average-sized video uses up the same badwidth as 30-page basic website pages.

[moose135]

It's a deal...

Google buys YouTube for $1.65 billion
THE ASSOCIATED PRESS

October 9, 2006, 6:17 PM EDT

SAN FRANCISCO -- Google Inc. is snapping up YouTube Inc. for $1.65 billion in a deal that catapults the Internet search leader to a starring role in the online video revolution.

The all-stock deal announced Monday unites one of the Internet's marquee companies with one of its rapidly rising stars. It came just hours after YouTube unveiled three agreements with media companies in an apparent bid to escape the threat of copyright-infringement lawsuits.

The price makes YouTube, a still-unprofitable startup, by far the most expensive purchase made by Google during its eight-year history.

Although some cynics have questioned YouTube's staying power, Google is betting that the popular Web site will provide it an increasingly lucrative marketing hub as more viewers and advertisers migrate from television to the Internet.

"We are natural partners to offer a compelling media entertainment service to users, content owners and advertisers," said Eric Schmidt, Google's chief executive officer.

YouTube will continue to retain its brand, as well as all 67 employees, including co-founders Chad Hurley and Steve Chen. The deal is expected to close in the fourth quarter of this year.

[Midnight Mike]

How long has YouTube actually been around? A year and a half or something? Imagine making a video site a in a very BASIC datbase fashion....and having more than a billion dollars 18 months later. Amazing.

Yeah, it's crazy. YouTube has some issues though....bandwidth for all that video (100 million clip-views PER DAY) is estimated at over $1 million a month. And the big one: even with better self-policing, something like 90% of their content is stolen, and that won't be allowed to continue forever. I'm also surprised that Google is giving up on their own video product which they spent a lot of coin on so soon, even though it is clear that they have a fraction of the traffic of YouTube.

Could be a good move by Google, right now, Google has about 10% of the Videon online market, by aquiring Youtube.com Google will now own a majority of the market & additional places to run their ads.....