Google paid $1.65B yesterday for YouTube. I’ve been thinking about it a bunch since then; starting to get stronger feelings about it.
First, I think that YouTube cashed out by flagrantly ignoring the rights of copyright holders, of the people who own the content that gets spread around. They used safe harbor laws to play within the letter of the law, but it was clear in a number of ways that they were never really doing much more than paying lip service. In my view, it’s wrong to build a business that does that, and cashing out is pretty undeserved. (Although, I will say that they executed like crazy. That’s a testament to them. A year and a half ago there were at least 50 “flickrs for video”. But they won.)
Second, I’m glad that video is becoming more viable on the web. It’s changed the way that I think about the web in the last year for sure. VideoEgg has let us put up lots fo videos of Sam which have really made a difference with his relationship with his grandparents & friends. iChat AV does the same thing. And the Democracy Player from Participatory Culture Foundation is a brilliant piece of work towards making video distribution truly more attainable by everyone.
Lastly, I’m pretty surprised Google made this purchase. I know their stock value makes stuff like this relatively inexpensive for them, but, truly, they haven’t been hammering away at Google Video for that long now. To cede the victory to YouTube after just a bit of time in the saddle doesn’t imply, to me, much faith in their ability to execute in this non-search market.
Anyway, I can’t get the development here out of my head for some reason — it’s really got me noodling. Can’t tell you why, exactly, except that it bothers me a bit.
In the end, it seems like YouTube didn’t have any problems (capacity, monetization, legal) that Google Video didn’t have. And it sounds like the personality fit with the founders made this a solid fit people-wise. Moritz has a hand here too, right?
I’ve heard this compared to eBay/PayPal, but remember, PayPal was a choice that millions of eBay members made first, before the acquisition. It would have been more comparable if MySpace had bought YouTube, since YouTube is so popular with MySpace users. Then again, they lose their ability to do media-neutral deals.
This is definitely a new watermark. The crescendo for Web 2.0 deals is growing… seems like the inevitable irrational exuberance is here.
– Adam
In the end, it seems like YouTube didn’t have any problems (capacity, monetization, legal) that Google Video didn’t have. And it sounds like the personality fit with the founders made this a solid fit people-wise. Moritz has a hand here too, right?
I’ve heard this compared to eBay/PayPal, but remember, PayPal was a choice that millions of eBay members made first, before the acquisition. It would have been more comparable if MySpace had bought YouTube, since YouTube is so popular with MySpace users. Then again, they lose their ability to do media-neutral deals.
This is definitely a new watermark. The crescendo for Web 2.0 deals is growing… seems like the inevitable irrational exuberance is here.
– Adam
I’ve also had the same sense of being somewhat bothered by the deal. For me, it’s not just the issue of YouTube profiting off of illegally uploaded content, it’s the lack of any regard for the users who posted their own videos and who built the site. At least competitors like Revver have a revenue sharing model that rewards content creators with a share of the ad revenue.
When I watched YouTube’s “A Message from Chad and Steve” (
I found myself pretty angry. The video is essentially YouTube’s founders laughing at their newfound riches. After a while, one of them gets around to remembering to thank the users, the people who actually created the content YouTube profits from, not to mention the people who post the copyrighted material that everyone flocks to the site for.
Now I didn’t feel so angry over, say, the MySpace deal, where there’s sort of a more abstract sense of ownership in one’s profile, but here, it seems like a pretty clear-cut case of YouTube cashing out on the backs of its content creators. When Hollywood does it, we call them heartless, but apparently it’s called innovation in the Valley.
I’ve also had the same sense of being somewhat bothered by the deal. For me, it’s not just the issue of YouTube profiting off of illegally uploaded content, it’s the lack of any regard for the users who posted their own videos and who built the site. At least competitors like Revver have a revenue sharing model that rewards content creators with a share of the ad revenue.
When I watched YouTube’s “A Message from Chad and Steve” (
I found myself pretty angry. The video is essentially YouTube’s founders laughing at their newfound riches. After a while, one of them gets around to remembering to thank the users, the people who actually created the content YouTube profits from, not to mention the people who post the copyrighted material that everyone flocks to the site for.
Now I didn’t feel so angry over, say, the MySpace deal, where there’s sort of a more abstract sense of ownership in one’s profile, but here, it seems like a pretty clear-cut case of YouTube cashing out on the backs of its content creators. When Hollywood does it, we call them heartless, but apparently it’s called innovation in the Valley.
This post is a little bit old, but it was recently the 10th google anniversary, and they are bigger and bigger, and buy more and more companies. Youtube was a big step, and they haven't stop since that. It's scaring the power that G is having.