Google Buys YouTube for $1.65 Billion

Over 30 readers wrote about Google's purchase of YouTube today for $1.65 Billion, as rumored last week. The all-stock transaction is the single largest purchase in the company's 8-year history. The move follows on the heels of Google's convincing Sony and Warner Music to put music videos online for free. Reportedly, YouTube will retain its brand and all its 67 employees, including co-founders Chad Hurley and Steve Chen.

So Google is going to become...

a series of 'tubes?

Re:So Google is going to become...

GooTube

eww.

A discussion other people just had

That's funny, I had a quick discussion with my co-workers too, and they were of the mind TEN MINUTES AGO [slashdot.org] that Google needs the following:

a. the users and more importantly
b. the usage pattern of these users

While google has been picking up little things here and there, essentially this is google's first real "social networking" site that they have purchased. I say it in quotes because youtube isn't really a social networking site, but there are certainly aspects of it that cannot be denied.

I say youtube lucked out and google really made a stupid purchase, it appears to me like it was an attrition attempt against the competition in internet space (yahoo? microsoft? myspace? - whoever they think their competition is atm, because I can't tell). I don't know.. I'm curious to see where this goes. Google definately wants to go into the multimedia distribution area, that's for sure. How they go about doing it, we'll have to see..

-----

Are you a script? If so you should be changed to reply coherently to replies in your thread, that would be more entertaining. Simply copying posts is a bit dull don't you think?

http://games.slashdot.org/comments.pl?sid=199747&c id=16357565 [slashdot.org]
http://games.slashdot.org/comments.pl?sid=199747&c id=16357445 [slashdot.org]

YouTube not evil!

SO glad that YouTube will now be sheltered by "the good guys" ... assuming they stay the good guys *cautious glance over shoulder*

Re:YouTube not evil!

SO glad that YouTube will now be sheltered by "the good guys" ... assuming they stay the good guys *cautious glance over shoulder*

I'm more than happy with that. At least now Youtube will have Google Adsense ads rather than Myspaces "epileptic punch the monkey you win a frigging iPod PS3 viagra sweepstakes" flash banner ads with 400 double click pop ups and unders.

Re:YouTube not evil!

Yeah, it's a bit overdone. Between the monkey, the iPod, and the PS3, you should have more than enough blood flow to not need viagra.

So ungoogle

This is so ungoogle. Google builds, not buys. Google indexes, not serves. Google already had a video service.

Google is jumping the shark.

Ill Go Ahead and Say it

The Bubble is back! Bubble 2.0, but a bubble nonetheless.

Re:Ill Go Ahead and Say it

no way, this bubble is way different. This time, instead of being unprofitable while hoping to strike it rich with any IPO, companies are unprofitable and hope to be bought out by Google.

Everyone learned from the last time, obviously the stock market is untrustworthy.

At that rate, does google want a game company?

Hey google, Thats 24 million dollars each isn't it? I'm a one man company, but you can buy my company (www.positech.co.uk) for just $15 million.
Give me a call, or just drop me an email guys. That figure is negotiable too.

Integration with Google Video?

Even though they say "YouTube will retain its distinct brand identity" I wonder how much integration they will eventually do with Google Video. Will YouTube videos be search-able on Google Video, for example? Google is usually good at not integrating just for the sake of integrating. For example, Google Analytics still uses a Flash based map instead of the Google Maps API.

Good buy for Google

I know some people won't get why they did this, or how Google will make money from YouTube. I will explain:

First, Google makes money through advertisement. Currently simple text banner ads. But a quick look at other sites will show you a growing interest in video ads. YouTube has a lot of visitors, and if Google plays this correctly they can make more advertisement dollars.

Secondly, YouTube signed some nice contracts with the likes of CBS and two music labels.

Re:Good buy for Google

I expect it was the contracts more than anything that justified the price. The original purpose though, was almost certainly to consolidate the two biggest video players into one. That said, the only reason this happened at all was because it was an all-stock deal. Google's stock was at around $430 today, which a lot of people seem to think is still over-valued, especially by people within Google. If the internal Google people think their own stock is over-valued, it makes sense for them to try to get the most out of it while it's still high.

Why did YouTube take the lead?

Is it because Google fumbled around trying to implement some sort of open-standards solution while YouTube built up a userbase with the corporate controlled but much more user friendly Flash format? (Egad, it even uses patented video codecs that Macromedia licensed!)

That's at least part of the answer.

Ouch Slashdot. $1.65 Billion. Ouch.

google

Does this mean that YouTube will now go into Beta status?

Too, I wonder how google will integrate the two.

$1.65 billion IN STOCK

Keep in mind that Google is not paying dollars -- they are trading Google stock for YouTube stock. So even though $1.65b is a scary number, what you should be asking yourself is not whether YT is worth $1.65b, but whether it is worth 1.25% of Google.

Google made money on this

Although I disagree with this long term, what most people haven't realized is that Google got YouTube for free. On news they might buy last week, their stock rose ~2%. It rose even more today with more news and will probably raise a bit more tomorrow. So, 1.65 billion in stock was given away which is something like 1.5% of the company. If they just increased the companies worth by 5%, did they not just make a profit buy "buying" this company?

Long term it might not turn out that way, but annually this is great.

Re:cool

CNN says it will [cnn.com].

Re:1.65 billyun.

Dear Google, Thanks for the 25 million junior bacon cheeseburgers. I hope you like getting sued. -The management

Re:1.65 billyun.

What makes you think that the stock is evenly distributed among all the employees? Don't forget that the VC firm also has a big chunk of it (quite possibly the largest chunk). After that, the founders will have the lion's share.

Anyhow, they can't just sell the stock and run. They'll have to wait some specific amount of time before being able to sell.

Re:Hmmmm

well the mpaa and riaa might have been itching to pick on poor little youtube but do they wanna pick a fight with google? i expect google will force these companies to deal with it and accept the internet isn't gonna go away (and share some ad revenue)

Re:Hmmmm

Blockquoth the AC:

i expect google will force these companies to deal with it and accept the internet isn't gonna go away (and share some ad revenue)

That's one possible outcome. Another is that Google, already treading a very fine line with several of its existing offerings, has just taken a step too far and is about to be slapped down hard.

If I were a betting man, I would actually bet against Google on this one. Admittedly, that is partly because I don't like the way they've started taking liberties with others' work and assuming something is OK as long as they're the guys doing it. But mainly, it's objective analysis: Google have some good products, but they have little that's unique, and none of their big revenue generators has a great barrier to entry. They're currently target number one for several other big tech firms, and fighting on all fronts, and I'm sure Sun Tzu had something to say about the wisdom of that approach.

Re:Hmmmm

The bubble will burst on this purchase. There's too much copyright infringement going on @ Youtube.

And more importantly, now there is someone to sue. Someone with lots and lots of money, so all those $200K per infringement civil awards actually have a chance of being paid out. Watch for Hollywood to their absolute damndest to take Google's IPO money the same way the RIAA took mp3.com's $200M of IPO cash.

Re:Explain to me...

IANAL, but I'm taking Computers and the Law, a course at my university about these matters.

The length of a clip is not the only thing that matters in claiming fair use: also important is the importance of the clip in regard to the entire work, whether the original work is more factual or more creative, and what effect the use of the clip will have on the saleability of the work as a whole. It actually cannot be known whether using a copyrighted material falls under fair use until one is sued over that material and goes to court for it, as fair use is up to a court to decide.

Also, even if the clips' being posted on YouTube violates copyright law, YouTube likely isn't liable for first-party violation, as they did not make the copies themselves, and they might not be liable for 2nd or 3rd party copyright violation if they can prove that they did not market YouTube as a place for copyrighted works to be posted by those who do not hold the copyright, and if they can show that they took appropriate measures to remove materials in violation of copyright.

However, it is best to assume that any material you see on YouTube that was not posted by the author IS in violation of copyright, as there have been no rulings in this regard, and unless an author specifically gives up his copyright or publishes the works under an open license (which still lets him retain copyright, but lets others use and distribute the work as well), then he has the right to sue for infringement, and YouTube will at very least be required to take the work down if they cannot prove fair use or de minimus (least possible to make a point) use of the materials, or that the work was in the public domain.

So, how are you so sure that the content does not violate the authors' copyrights?

Re:All i ask for is:

When I'm searching for boobies, I don't care if it's one or many boobies they're showing.

Well given that they typically travel in pairs, the type of video where there's only one may perhaps be a little more... surgical... than intended.