Google to Acquire YouTube for $1.65 Billion
Google to Acquire YouTube for $1.65 Billion
Google, a company which has made billions off the online search market, has not been able to become a major player in the online video market. However, that is all going to change due to Google’s recent purchase of the video-sharing website YouTube, which Google bought for $1.65 billion. This deal came just weeks after YouTube unveiled agreements with three media companies in an effort to escape possible copyright infringements. This is Google’s biggest purchase in its eight year history.
YouTube is still yet to show a profit, but Google and other analysts believe that the video-sharing market will continue to become more lucrative as more and more consumers veer away from the television and onto the internet. Other cynics view YouTube as nothing more than a fad that is doomed due to its high volume of copyrighted material that will result in the eventual oblivion of the site (much like the once popular music sharing site, Napster).
Microsoft Corp., News Corp., and Yahoo Inc. were among the other companies that discussed the possible purchase of YouTube over the past several weeks. However, Google was the one applauded by most investors as they saw Google’s stock price rise on the Nasdaq to $429 (an $8.50 increase).
YouTube has seen its worldwide audience climb to over 72 million users, as opposed to about 3 million one year ago. It also has entered into partnerships with Universal Music Group, CBS Corp., and Sony BMG Music Entertainment. These partnerships came shortly after the agreement signed a month earlier with Warner Music Group Inc. These recent partnerships and the acquisition of YouTube are expected to help Google become the largest player in the online video industry.
picture above found here
posted by jfight at 8:52:00 PM
1 Comments:
This is so unbelievably crazy that a company would pay so much to buy another company. One point six billion dollars does not even seem like a real number. I can not imagine what the owners of youtube are going to do with all that money. I am curious to how much it will be worth in the long run. There are still other companies that will try to compete with youtube. It is true that google once tried themselves to compete yet they were unsuccessful. Maybe, youtube has too much of a hold on the market. Either way it is still a crazy story. It is also interesting that there was a bidding war for the company. It would be interesting to know what the original starting offerings were and to see how much the sale price went up with companies like yahoo trying to buy them out.
6:12 PM
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