Google buys YouTube

Critics and sceptics have been against YouTube since the begining, even going so far to say that YouTube was worthless.

Obviously Google didn’t think so, with the latest news that the industry giant purchased the small company for a reported $2.2 billion.

The deal, the first to value one of the new crop of user-participation web sites at more than $US1 billion, combines two of the most popular internet brands: Google, synonymous with web search and rapid innovation, and YouTube, a Silicon Valley upstart that has spearheaded the video-sharing craze.

For Google, the acquisition of YouTube would thrust the web search leader quickly into the emerging market for video advertising, where it has only a tiny foothold compared with Yahoo and various web start-ups, analysts said.

YouTube was founded in February 2005 as one of dozens of internet video start-ups. It has exploded in popularity since last November by letting users share short clips of home videos and programming copied from television.

YouTube has been the subject of acquisition speculation for much of this year. Potential buyers included Google’s rivals such as Yahoo, as well as media companies such as News Corp, owner of MySpace.com, and MTV owner Viacom.

Source: SMH

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