Stan Beer
Saturday, 07 October 2006 09:10
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While some analysts have postulated that YouTube will be sued into oblivion, search giant Google apparently couldn't give two hoots for their opinion and has reportedly offered the popular video posting site its asking price of US$1.6 billion.
In the space of a few short months, the rise
of YouTube traffic has been meteoric and the site now gets somewhere
between 16 million and 20 million unique visitors a month.
Some pundits have postulated that the Google offer to buy YouTube is as
much a defensive strategy as anything else. With Microsoft, Yahoo, AOL,
all said to be in the race to buy the largest repository of video clips
on the web.
It is becoming increasingly clear that on the web content is king.
Google, with no content of its own but a growing range of web services
around which it sells advertising, may be keen to add another string to
its bow and in the process prevent its rivals from getting hold of
another lucrative web property.
In 2005, Rupert Murdoch was ridiculed when News Corporation paid US$580 million for MySpace.
Today, MySpace has about 100 million registered members and is one of
the most visited sites in the world. Murdoch's previous detractors are
no longer laughing because US$580 million seems like a bargain.
Likewise, next year US$1.6 billion for YouTube may seem like a steal.
Forrester analyst Josh Bernoff recently predicted in his blog that
YouTube will face the same fate as the original Napster, as has
billionaire entrepreneur Mark Cuban. Both believe that the site will be
sued out of business because of the large amount of material posted
that is protected by copyright.
However, other analysts dismiss the comparison of YouTube with the
early Napster as erroneous. Unlike the Napster of 2000, YouTube has a
significant proportion of original content and already has agreements
in place with content providers such as Warner Bros and NBC.
With a backer like Google, which is getting used to fighting legal
battles centered around the free distribution of content on the web, it
is unlikely that anyone would even attempt to suggest that YouTube is
not going to be around in the future.