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Summary:

TechCrunch writes about a rumor out there that Google will buy YouTube for around $1.6 billion. Hmmm, haven’t we heard this story before: (Fill name) will buy YouTube for $X Billion. At this point, we are going to wait for the fat lady to sing. Anyway […]

TechCrunch writes about a rumor out there that Google will buy YouTube for around $1.6 billion. Hmmm, haven’t we heard this story before: (Fill name) will buy YouTube for $X Billion. At this point, we are going to wait for the fat lady to sing. Anyway the deal has as much chance of happening as me dropping 40 pounds. Google folks have to be aware of the fact that the minute they buy YouTube, they are going to have to deal with lawsuits by truckloads, which could cost them money, but more importantly distract them from their core business.

WSJ is reporting the story, so there might be sparks if not a fire here. Still they are sourcing it to one person and with the usual disclaimers. Here is an open URL for the WSJ story. I just got off the phone with Google spokesperson who declined to comment saying that it is company policy to not comment of speculation and rumors.

  1. “Google folks have to be aware of the fact that the minute they buy YouTube, they are going to have to deal with lawsuits by truckloads, which could cost them money, but more importantly distract them from their core business.”

    Om, Google Video is very similar to YouTube and I haven’t seen any lawsuits.

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  2. Well, well… if Wall Street Journal backs a rumour, it usually is a STORY.

    http://online.wsj.com/article/SB116014813857884917.html?mod=homewhatsnews_us

    Google Is in Talks to Buy YouTube

    By KEVIN DELANEY
    October 6, 2006 12:46 p.m.

    Google Inc. is in talks to acquire popular video-sharing site YouTube Inc. for roughly $1.6 billion, according to a person familiar with the matter. The discussions are still at a sensitive stage and could well break off, this person says.

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  3. it is a story based on information from “a person” so not sure if i am buying this one for now. if it happens, we shall see. but then i also didn’t see the ebay/skype deal happening.

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  4. This is very unlikely going to materialize. Base on some common sense.

    Google has put a lot of work into Google video, partnerships, etc, I agree that a merger would be beneficial but not unless these issues get resolved first

    • Possibilities of pending ligitation from media companies.
    • Overvalued at $1 – $1.5 billion. Youtube has not make a single dollar to date, and burning cash like crazy, why take on a sinking boat? When myspace got bought, they have approximately 1200% growth in revenue, but that only put them at $560 million. How about youtube? I guess its too early to say without seeing numbers.
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  5. Watch Jim Cramer on Mad Money pump Level3 on the rumor of Google and YouTube.com joining hands in Video Nirvanna
    Level3 carries BOTH Google and YouTube and A Sugar Daddy Like Google to Level3 is like music to my portfolio!
    skibare

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  6. If anyone has ever dealt with the clowns that developed and run Google Video – they would know these two copyright violating entities belong together. RIP!

    here’s a quote from Peter Chane at Google Video in a Wired Magazine Interview… http://www.wired.com/wired/archive/14.05/google.html

    This is the best line of all …
    Who’s your competition? iTunes? YouTube? Yahoo?
    I’m not viewing those as competitors. I think the competition is content providers that haven’t looked at online as a distribution channel. Google Video and these other sites are saying, “Hey, you can make money online!”

    Yup, boy genius thinks of his supply chain as his competition… way to go buddy!

    And when there is enough money to be made from lawsuits – OH YES – those copyright holders will be there to collect.. you just wait and see… a good lawyer always counsels his clients to wait till the bounty is big enough for all to feast on…

    And OM I agree with your odds… but again – you seen these crazy thing happen in the past…

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  7. I bet it’s actually Mark Cuban buying YouTube. His previous Advertising Week comments were just an attempt to drive the price down.

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  8. Charlie Sierra Friday, October 6, 2006

    Om, I’m only looking to drop 30lbs.

    Oh wait, your post wasn’t about a new Web2.0 weight lost thingy. Nevermind.

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  9. I must admit, I’ve been a whole lot less confident in saying “That is so crazy it will never happen” ever since the eBay-Skype deal.

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  10. its not common sense that defines a good deal. Actually in the web 2.0 bizz, there is no common sense at all, same as web 1.0.
    1.5 billion is not such a big number for a big company like google. Take a look at google’s shareholder value and think about an acquisition – how much would such an nonsense deal push the stock’s prize… (usually, shareholder like nonsense).
    Anyway, there will be a boom and bang in the future and many companies will hopefully be punished for their greed.

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