Analysis of IT news

Sunday, October 15, 2006

News Item: Google acquires YouTube

News Item: Google acquires YouTube

Analysis: Google has been trying to get a serious foothold on the online video market with Google Video, but has been quite unsuccessful. Acquiring YouTube allows it to become #1 instantaneously. Now, the question is: was the price worth it? $1.65 billion is a hefty sum for a company that is losing money.

Nobody knows Google's plan, but one can speculate.

First of all, Google might try to make some money through advertising. Also, Google knows it now needs to struck some partnerships with some power player. So deal that YouTube struck with some music majors such as Sony is a good news for them.

The biggest risk right now is the potential lawsuits related to the publication on YouTube of unauthorized copyright content. It seems however that Google has already thought of that by setting aside some money for potential lawsuits, as well as paying music majors some money.