Oct 10, 2006

Posted by in Audio & Video | 14 Comments

Google to Acquire YouTube for $1.65 Billion

It’s been confirmed, folks. Google is set to acquire YouTube. And the price? It’s even higher than the original estimate of $1 billion!

Here’s the Google Press Release.

MOUNTAIN VIEW, Calif., October 9, 2006 – Google Inc. (NASDAQ: GOOG) announced today that it has agreed to acquire YouTube, the consumer media company for people to watch and share original videos through a Web experience, for $1.65 billion in a stock-for-stock transaction. Following the acquisition, YouTube will operate independently to preserve its successful brand and passionate community.

Google is banking on YouTube’s success in terms of userbase and community. YouTube, meanwhile, will benefit from Google’s existing advertiser relations. So there is a business model, after all.

My only concern at this point is on copyrighted content that’s already on YouTube. Does this mean they will be more actively purging the site of copyrighted content? And does this mean that copyright owners will start taking legal action?

Here’s an analysis of the reasons and implications of the acquisition on ForeverGeek.



  1. For YouTube founders and investors – Good!
    For Google – ???
    For the web industry – it’s teh bubble!

  2. ive always thought that youtube is a yahoo company.. thats why ive always wondered why they are showing google ads on it.. now i know why..

  3. No wonder Google’s been doing YouTube favors in their SERPs.

  4. And for the Pinoys –

  5. And for the Pinoys – so what?

  6. I believe this event is a tipping point that will start a cascade of mergers and shake outs. This is because all of the companies cannot exist under the same model competing for the same eyeballs. One of the star companies I see being picked up next is Revver. This is because Revver has the best potential for revenue in the future.

    But once the dust settles, I think video uploading sites will become less of a focus. Instead video aggregator sites will dominate the internet; specifically, sites that do not host content. This is because they will remain impartial to the site where the video is uploaded. Moreover, they will be very efficient and cost effective.

    Some of the sites I think will dominate the next wave of video on the web are VideoBomb, Viral Video Chart, and KungFuGrip. I represent KungFuGrip. Our philosophy is to aggregate creative entertainment across the web using a Digg.com model.

  7. What’s in it for Pinoys? Maybe somehow Google would make it easier for Pinoys to create original content. With Google’s clout with hardware makers, they could load Youtube onto cellphones.

  8. see it this way, since more and more people are tuning into their computer rather than their tv, google acquired youtube, its like google putting up their own tv station like cbs or nbc where contents are from independent user instead of producers and directors, and its for the user, and by the user.. instead of concepting and creating shows (ive read somewhere in GQ magz how much pilot episodes cost and a lot of it goes to the pooper), they can focus more on the advertisement, since its the name of googles game.. then imagine this, those ads we see in googles, add thumbnails of youtube vids and mix with keywords, now those is what i call advertisements..

  9. Definitely for the eyeballs. But I doubt if they want to make 20 or 40-minute long features to compete with TV.

  10. Mparaz,

    It is already easy for Pinoys to create content and upload to Youtube. Putting Google in the picture will provide marginal progress, if any at all.

    IMO, the best way for this merger to help Pinoys is if Google shares the ad revenues to those who upload content. Then people will have incentive to upload. Now that’s a business model I want to see!

  11. JackCrowley says:

    YouTube just got slower lately. Maybe the transition to Google wasn’t as smooth as anticipated.

  12. did anyone notice that google adsense is now offering google video ad for publishers..? and youtube on the otherhand is now more strict in copyrighted videos..?

  13. Youtube’s Lonelygirl15 makes the cover or Wired News

    http://www.dinagyang.com/forum/index.php?topic=2144.0

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  1. Why YouTube is a good buy for Google? » @ Ambot ah! [ technology news and reviews ] - [...] So, after days of speculations Google finally announced its acquisition of YouTube today (Oct. 9 in the US). [...]
  2. raincontreras.com » S-s-s-somethings That Should Be On My Asides List - [...] Google Buys YouTube. Initial reaction? I have to think on an online business model, make it profitable, and sell …

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