grantrob's blog: IT Blog #2

October 07, 2006

IT Blog #2

Google Hunting Down YouTube

Just as sports teams try to acquire top athletes, search giants such as Google and Yahoo are currently in the race to acquire popular and growing online sites. Google is currently neogotiating with top executives of You-Tube, only to purchase the leading online-video site for 1.6 billion dollars.

Youtube to be acquired?

Last week, Grant, Brett, and I shared the thought of Yahoo wanting to buy Facebook for 1 billion dollars. As Facebook users, we all thought that this amount is quite ridiculous; yes, a lot people do use Facebook. Yes, Facebook is very popular. But, what is the factor that makes these sites worth so much. In the BILLIONS!!!

We have all been on You-tube. However, we did not know that You-tube commanded 46% of visits to U.S. online-video sites in September while Google online video only has about 11%. If Google do land this deal in buying You-Tube, then the search giant would be the dominant leader in online-video.

The You-tube acquisition could mean so much to Google. First of all, Google can enhance You-tube's search engine making videos easier and more accessible to viewers. Secondly, Google can extend its profit-making ad strategy and bring lucrative cash flow from You-tube's ads. Finally, as the current dominant search engine, Google will expand and soon become the dominant "online video" provider. This all will prove very valuable to Google. Considering a market cap of over $150 billion, the $1.5 billion paid for You-tube may be a worthy acquisition in the long run.

Yet, as Grant, Brett, and I have discussed, the billions of dollars spent in acquisitions is unimaginable for a simple URL.

Posted by lisun at October 7, 2006 12:41 PM

Comments

Yeah, I too find it amazing --- though I believe it is entirely believable and supportable. You should think more deeply about what Google hopes to acquire with this purchase that they would have found difficult to acquire otherwise.

You should really work on your spelling and, especially, your grammar in your post.

Posted by: samoore at October 10, 2006 08:19 AM