Google reportedly in talks to buy YouTube

[karyn]

from san francisco chronicle

10-06) 12:13 PDT -- Google is reportedly in talks to purchase online video site YouTube for $1.6 billion, according to several media reports.

The Wall Street Journal Friday, citing a source familiar with the talks, said Google, the Internet search leader was at a sensitive point in the talks to buy YouTube, the leading online video sharing site.

The Journal's report comes on the heels of similar speculation on the technology blog, Techcrunch, which said a deal was in the works a day earlier.

Google and YouTube representatives declined to comment on the rumors Friday.

San Mateo-based YouTube was established by three veterans of online payment provider PayPal and currently has 43 percent of the online video sharing market, according to Hitwise, an Internet research firm. YouTube visitors watch more than 100 million videos a day on the site, according to the company.

Google Video, a competing video service that the search giant hoped would make it a significant player in the burgeoning world of online video, ranked fifth in the field with 6.5 percent of the market.

The purported price of the deal is considerable. By contrast, News Corp. purchased *******, the leading social networking site, for $580 million last year.

The company's chief executive Chad Hurley has previously said the company was not for sale and a future initial public offering was possible.

The New York Post last month, however, quoted a source inside YouTube who said the company would not sell for less than $1.5 billion.

[Mindgames]

With the recent PPL deals struck between the US majors and YouTube, it's running all over what Google Video originally intended to do but couldn't - so there's no surprise Mountain View's got its sights on them. The sticking fact is until the lawsuits from all the other studios and labels run through, a buyer is potentially lining themselves up for billions in copyright penalties.

[TheQuietPlace]

Man I have no freakin' idea what all the hub-bub is about YouTube. Its kinda neat...but really c'mon its not worth 1.5billion.

[VoldtaEngler]

Man I have no freakin' idea what all the hub-bub is about YouTube. Its kinda neat...but really c'mon its not worth 1.5billion.

if more than 100 million videos are watched by thousands of people every day, its a good source of revenue for ads, even though youtube just recently started with bannerads, they arnt really intrusive like most sites.

Basically they will make their money back withen a year or two's time and have a video site under their belt.

Lets face it..google video isnt the best place for netvids like youtube.

What i find more amazing than them bidding to buy it for 1.whatever billion is that just a few years ago it was two guys who rented a garage for 1,000$ a month and created google while living in cars. THATS a better story!

[Amelia G]

Honestly, it makes me sick that people who create marketplace's for stolen goods like Napster and YouTube can get paid like that.

I also think that a property like YouTube is not great for advertisers. I was at a party last weekend and one of the guys there was saying how great YouTube is, even though he's a model/TV actor. So someone busts out a laptop so he can show something on it. He loads up a page and an ad for wine comes up. And they guy who had been saying how great the site was started laughing like, yeah, he was really going to buy wine while surfing YouTube. Great ad market.

[ForrestBlack]

I also think that a property like YouTube is not great for advertisers...

Yeah, at least ******* has some contextual information to go on, so they know the demographics to serve various ads for. I suppose with commercial seeding, something like youtube could potentially be good for pseudo-underground corporate "viral" clips, much like the various popular shock-video clip sites are now. But, I think it's more likely they just had development rights to some technology that Google wanted and the shape of it will change.

[VoldtaEngler]

But, I think it's more likely they just had development rights to some technology that Google wanted and the shape of it will change.

thats what i meant to say but you said it better.

[Bondage Clown]

Right now the standard way to gauge how much a site is worth, is $4 per page view (i.e. click)

This is one of the ways I track my websites.. (Of course i used Blueblood as the example.. I don't want to toot my own horn, and I love this place... )

Blueblood stats on Alexa

[VoldtaEngler]

Right now the standard way to gauge how much a site is worth, is $4 per page view (i.e. click)

This is one of the ways I track my websites.. (Of course i used Blueblood as the example.. I don't want to toot my own horn, and I love this place... )

Blueblood stats on Alexa

so 45,789 vistors for today it says.. times $4 means a revenue of 183 grand just for today? Share the wealth

unless of course im totally calculating that wrong.

but from what i can tell the alexa site says
"Alexa computes traffic rankings by analyzing the Web usage of millions of Alexa Toolbar users. The information is sorted, sifted, anonymized, counted, and computed, until, finally, we get the traffic rankings shown in the Alexa service."

Does that mean it only tallies the ones that have the alexa toolbar? Ive never heard of the site until now.

my sites not in the top 100,000 so it doesnt really show anything..but my actual stats page located withen my server is:
Unique Visitors for Oct. 6, 2006: 39,601
Most visitors online: Between 10PM and 11PM EST

Does that mean im worth 158,404$ yesteday? Im selling. I need a vacation! I dont think my business is really worth more than maybe a grand or two but its fun to dream lol.
This is interesting though

[ForrestBlack]

unless of course im totally calculating that wrong.

You are actually calculating it wrong. That's not visitors, that's site rank on the entire internet.

[ForrestBlack]

You are actually calculating it wrong. That's not visitors, that's site rank on the entire internet.

and a site's Alexa is calculated on average, not one day rank, so BlueBlood.net is currently at 33,278 which is a better score. You might notice that Google's score is 3.

[Amelia G]

Right now the standard way to gauge how much a site is worth, is $4 per page view (i.e. click)

Where did you get that method of valuing a site? I've never utilized that when buying a site myself and, although I'm familiar with a variety of method's of valuation, I've never heard that one.

[Mindgames]

Where did you get that method of valuing a site? I've never utilized that when buying a site myself and, although I'm familiar with a variety of method's of valuation, I've never heard that one.

Me either - within the media sector there are formulas but they're far more complex than $-per-click. The inherent revenue value of a site relates to a multiplication of three basic factors: the number of unique visitors per accounting period, the mean value of purchases made over the period, and a scaling factor for the demographic of the target audience - so using a very oversimplistic example, if a clothing site gets 100,000 unique visitors a year and the mean product value is $10, the site clears $1m a year but it's not "worth" that - as it won't expand linearly and you don't yet include the costs of running the damn thing. The demographic fiddle factors (average income, geolocation, age, etc.) decide if a tenfold increase in visits gives you more or less than $10m. Usually it's less by at least 30%, as the more popular a site gets, the more it costs to host and the more non-buying visitors you'll get.

YouTube's been unique in terms of legal status - I know what Amelia's saying, but from day one it's had an office, a phone number and a server IP - so it's never tried to avoid being served paper like P2P networks do. I've talked to them many times over their history and their basic plan (which has worked pretty damn well) was to get so big so quickly their public support outweighed the revenue losses IP owners would seek to extract. Studios can C+D a tiny site in seconds, but even for millions in lost revenue they risk a public hammering if they go after something as fluffy and cute as YouTube. Most of them are already using it in the factoring for marketing - my old label predicts 1day CD sales off YouTube plays of the video.

mG

[Buster Friendly]

personally i think youtube is great.

it's a great outlet for video artists to get their stuff more exposure, it's a great way to share clips of ultra rare stuff that simply isn't widely available.

i have found very few full length (in sections) clips of any commercial work, and quite frankly am very happy to have been able to see a number of obscure asian clips that i would never have been exposed to otherwise. built up my interest in the full length product.

things that seem to be in copyright violation get yanked. sometimes.

i know i could always order cable, but it's been nice to see some clips of stephen colbert.

mostly though i see it as an outlet for folks to share video they've made... get exposure for their favorite band, etc.

[ForrestBlack]

it's a great outlet for video artists to get their stuff more exposure, it's a great way to share clips of ultra rare stuff that simply isn't widely available.

I'm having trouble thinking of a great deal of examples of valuable ultra rare clips that are outside the parameters of commercial work.

i have found very few full length (in sections) clips of any commercial work, and quite frankly am very happy to have been able to see a number of obscure asian clips that i would never have been exposed to otherwise. built up my interest in the full length product.

One can only hope that some sort of global communication network might someday be invented where you could legitimately enjoy obscure foreign media without being forced to violate the intelectual property rights of it's rightful owner. Wait a minute, you're soaking in it, Madge...

things that seem to be in copyright violation get yanked. sometimes.

i know i could always order cable, but it's been nice to see some clips of stephen colbert.

mostly though i see it as an outlet for folks to share video they've made... get exposure for their favorite band, etc.

I've never really bought into the 'it's rare and valuable so it's ok that I stole it' argument, as applied to whatever people manage to be able to get their hands on over the internet. If you are going to be a thief, at least have the honor to know what you are. To rationalize it as somehow righteous is self delusional at the very least. I mean, I'm not saying that large scale well coded distribution sources for video content are fundamentally bad, but when intelectual property is torn from the hands of their rightful owner and redistributed at some stranger's will, I just can't see how that isn't wrong. If Colbert puts a clip up on his site, that seems reasonable. It's his networks choice, but any bozo with a dvr gets to be 'cool' for posting material he doesn't have rights to? That's just criminally wrong.

...but that's just my opinion, and I'm not trying to be unfriendly, it's just my honest opinion.

Maybe I'll start a website where people can bid on stolen cars and rely on it's popularity to keep me fully surrounded by lawyers long enough to sell it off for a billion dollars.

[Buster Friendly]

i stole it, it's in my brain, i'm a thought criminal, time warner can eat a dick.

[Mindgames]

Maybe I'll start a website where people can bid on stolen cars and rely on it's popularity to keep me fully surrounded by lawyers long enough to sell it off for a billion dollars.

The US Treasury used to have one, but now if you want to snap up the fake Rolex of a dead drug dealer, or the private jet of an actor having issues with his tax return, you gotta do it by phone.

http://www.ustreas.gov/auctions/customs/la.html is your nearest

Bidding with a cell number and calling yourself "Guido da Knife" won't be a brilliant idea though.

mG

[VoldtaEngler]

and a site's Alexa is calculated on average, not one day rank, so BlueBlood.net is currently at 33,278 which is a better score. You might notice that Google's score is 3.

thanks for clarifying it up!

[Amelia G]

Studios can C+D a tiny site in seconds, but even for millions in lost revenue they risk a public hammering if they go after something as fluffy and cute as YouTube.

mG

To me, that is where the evil lies. The notion that it is somehow uncool to steal a car but just fine to steal art . . . well, the more successful that notion becomes, the less good art we will have. Oh, there will be Web 2.0 15-minutes-motivated media, but there will be less and less heartfelt, quality art with productions values.

I think the guys in Metallica are jerks, but not because they felt that it was not okay for their work to be stolen and redistributed at random.

For myself, I frequently don't care about the money. I've turned down A LOT of paychecks. But the ownership of my work and the ability to control how it is presented is really important to me.

I don't mind working hard, but it starts to feel kind of pointless when the people getting significant payouts are all thieves, maybe hardworking thieves, but thieves nonetheless.

[Amelia G]

I'm going to add that this is why there is already so little good writing on the web. Text was the first really easy media to steal. I'm trying to get over my own discomfort with posting anything online, but it is difficult. People are so used to stealing text online that I've had whole fiction pieces copy/pasted and I even had a friend of mine steal my words and use them to sell someone else's site. It is difficult to motivate many of the writers I enjoyed working with in print to allow their work to appear online. People will post whole novels which are nowhere near old enough to be in the public domain. Most good writers don't post much beyond journal entries describing what they ate for lunch and that their lover dumped them so they are fuckable now and so-and-so owes them something. Only I love the written word and yet it is quite a journey maintain an even keel and to try to put it in place.

[VoldtaEngler]

[Buster Friendly]

i dont' really feel that our current copyright laws, and such are a cut and dried issue.

i actually wrote out a really long response to Forrest, but the connection i'm using bounced it, so i sent the above one instead.

it's complicated, and media's going to have to evolve, and adapt to the technology, just as it always has. the gennie's out of the bottle...

i just went to see jet li's new movie last night, clips of which i've already seen on youtube. i was probably going to see that one anyway... but there are other movies/bands, etc. that i would go see in a heart beat now because i enjoyed what i saw on that site. ("Sha Po Lang" for instance. insane donnie yen/sammo hung traid ganster flick.)

althrough out the 80's and 90's it was nearly impossible to get ahold of Shaw Bros. movies because the Shaw's refused to release them to western distributors, crap pirated versions were all you could get (big long story for another time.)

i agree with amelia though the net is crap for writing... i'm not quite sure the money is the issue, something about the medium makes me less perfectionist about my verbage.

[GnArKiLL]

Man I have no freakin' idea what all the hub-bub is about YouTube. Its kinda neat...but really c'mon its not worth 1.5billion.

you have much to learn about buisness voldta pretty much covered it.

[Amelia G]

i dont' really feel that our current copyright laws, and such are a cut and dried issue.

i actually wrote out a really long response to Forrest, but the connection i'm using bounced it, so i sent the above one instead.

it's complicated, and media's going to have to evolve, and adapt to the technology, just as it always has. the gennie's out of the bottle...

i just went to see jet li's new movie last night, clips of which i've already seen on youtube. i was probably going to see that one anyway... but there are other movies/bands, etc. that i would go see in a heart beat now because i enjoyed what i saw on that site. ("Sha Po Lang" for instance. insane donnie yen/sammo hung traid ganster flick.)

althrough out the 80's and 90's it was nearly impossible to get ahold of Shaw Bros. movies because the Shaw's refused to release them to western distributors, crap pirated versions were all you could get (big long story for another time.)

i agree with amelia though the net is crap for writing... i'm not quite sure the money is the issue, something about the medium makes me less perfectionist about my verbage.

I don't think it is the money; it is the lack of enforceable ownership.

If I come up with a really clever or witty turn of phrase, I kind of want credit for it.

But, in the world of the internet, the more likely result is that someone will repeat it without giving me credit, maybe just one phrase or maybe a whole paragraph copy/pasted for search engine placement or maybe a whole article or story so someone can pass it off as their own.

I think photography is headed in the same direction, as I see more and more prosumer hobbyists producing more and more self-aggrandizing and self-indulgent and unsatisfying (for the viewer) work.

Video is just the newest technology to head down that path.

[Amelia G]

Oh yeah, and I don't think there is anything off about having board posts and journal entries be less eloquent than actual writing writing. Sometimes something is just a casual conversation and I hope nobody is going to grade me on what I say over coffee.

[ForrestBlack]

I trust that you actually do know there is a difference between watching a movie, and sneaking a video camera into the theater so you can copy it and redistribute it for free on the internet. The vast majority of intelectual property violation issues are in regards to distribution, not consumption.

[VoldtaEngler]

I trust that you actually do know there is a difference between watching a movie, and sneaking a video camera into the theater so you can copy it and redistribute it for free on the internet. The vast majority of intelectual property violation issues are in regards to distribution, not consumption.

yea i do. im dumb but not that dumb. i was just trying to make light of the topic and Amelia's stealing text post.

[Buster Friendly]

I don't think it is the money; it is the lack of enforceable ownership.

personally, i think it's something inherent to the medium... for whatever reason, i just cannot be bothered to go into the sort of detail i would use with a written lettter in e-mail.

i know several fellas who have their own e-books. to them it's all about getting folks to buy that first e-book, and then after that they're really not the concerned. there are even mirror sites with some of their content up, but only they can produce NEW content of their own work,

again, i feel like creative people have to get creative about these things. if the technology is there, some one around the world will exploit it.

i may have mentioned that asian countries (china specifically) have a different view of copyright... which is basically they don't care. (ha! in a bruce sterling novel america is bankrupted overnight by a chinese satellite which distributes for free any, and all american intellectual property...)

the reasons you've mentioned amelia may be a factor, but i also feel that printed pages, paper-are just easier on the eyes to read, i don't think books will ever disappear.

as for video... i would have absolutely no problems whatsoever if youtube instituted a 'directors only' policy... if they only let people upload their own content. that'd be fine with me, i've seen some very creative stuff on there. yeah, it would have been a fucking shame for me to not have learned about Yendri, or seen the ManOwaR/Conan mash up... but EBN still posted their own stuff up there, and i now have links to their sites...

[Mindgames]

...but only they can produce NEW content of their own work...

Very true (so far - but don't get me started on what people are doing with virtual musicians) - but it's still not the point Amelia, Forrest and I are making. If you produce an item of creative art, be it a story, a photograph or a movie, the critical issue isn't how long it took you, how hard you worked or how many you knock out in a week, it's if that piece of art pays your mortgage or not.

There are countless millions of people for whom the creative act in itself is their goal, and they're prefectly happy to throw their work out for free (cue DeviantArt nd a billion homepages). Others have a half-assed stab at making back their overheads by selling a few copies, but don't really care if their stuff is leaked. Our problem is there are still a lot of us for whom that piece of art is the only thing putting beer on the table, and if it takes a year to write a book or three years to write an album, it had damn well better pay back in the tens/hundreds of thousands or we're living on the streets.

What (with respect) the 'public' don't get is that the studios, labels and managers of the world are immune to copyright theft - they make enough buffer income to live with it and still gold-plate their washroom doors. The reason is that the loss of revenue is offset to the artists in their royalties and advances, and yeah, some of us have a little cash put away - but not enough to afford the costs of keeping our stuff secure. Labels and studios do that for us, and in return they take a damn big percentage from every book, DVD or album sold. If they stopped all the 'bad press' lawsuits and stern warnings, then frankly I'd give up what I do and look for a secure income stacking shelves. It's just not worth it to have your entire year's salary put in the hands of a Ukranian copying shop.

I KNOW that people think sharing stuff is a victimless crime, and I appreciate that 'the industry' can shoot itself in the foot by associating with the sharing system (viral advertising and all that) - plus for a lot of people getting exposure for their art is more important than the theft - those people usually have a dead-end job to keep them fed while they upload tracks to maispayce. The people you've already heard of don't have the fallback. We're professionals trying to sell a product that can be copied and shared endlessly, a unique thing in this world and a damn hard way to pay the bills because of it. If you want a world of free-access art, then you'll get a world where the only artists left are amateurs.

mG

[Amelia G]

Very true (so far - but don't get me started on what people are doing with virtual musicians) - but it's still not the point Amelia, Forrest and I are making. If you produce an item of creative art, be it a story, a photograph or a movie, the critical issue isn't how long it took you, how hard you worked or how many you knock out in a week, it's if that piece of art pays your mortgage or not.

There are countless millions of people for whom the creative act in itself is their goal, and they're prefectly happy to throw their work out for free (cue DeviantArt nd a billion homepages). Others have a half-assed stab at making back their overheads by selling a few copies, but don't really care if their stuff is leaked. Our problem is there are still a lot of us for whom that piece of art is the only thing putting beer on the table, and if it takes a year to write a book or three years to write an album, it had damn well better pay back in the tens/hundreds of thousands or we're living on the streets.

What (with respect) the 'public' don't get is that the studios, labels and managers of the world are immune to copyright theft - they make enough buffer income to live with it and still gold-plate their washroom doors. The reason is that the loss of revenue is offset to the artists in their royalties and advances, and yeah, some of us have a little cash put away - but not enough to afford the costs of keeping our stuff secure. Labels and studios do that for us, and in return they take a damn big percentage from every book, DVD or album sold. If they stopped all the 'bad press' lawsuits and stern warnings, then frankly I'd give up what I do and look for a secure income stacking shelves. It's just not worth it to have your entire year's salary put in the hands of a Ukranian copying shop.

I KNOW that people think sharing stuff is a victimless crime, and I appreciate that 'the industry' can shoot itself in the foot by associating with the sharing system (viral advertising and all that) - plus for a lot of people getting exposure for their art is more important than the theft - those people usually have a dead-end job to keep them fed while they upload tracks to maispayce. The people you've already heard of don't have the fallback. We're professionals trying to sell a product that can be copied and shared endlessly, a unique thing in this world and a damn hard way to pay the bills because of it. If you want a world of free-access art, then you'll get a world where the only artists left are amateurs.

mG

Agreed on all points. I'd add though that most artists, even very financially successful artists, have some art they get paid for and some they do not. There are a lot of projects I create for reasons besides direct financial gain. However, if I say photograph a nightclub because I think I will get to create some interesting images and it will support the scene, I might not expect to get paid for it. But I also damn well expect that, if I am creating something and showing it to people for free, then I don't want other people stealing it, giving me no credit, and making money off of it. I don't want something I created for love to be turned into merch, personal publicity photos, album covers, web site clip art, political statements I might disagree with, and so forth, with no thought to what my intentions -- the creator's intentions -- were when I created it. If someone loves an artist's freely displayed creations so much that they want to have them as their own, then it seems that they should be willing to pay for them. My requirements for credits and such are of course quite different if I am doing a gig for love or getting paid full rate.

[Amelia G]

i may have mentioned that asian countries (china specifically) have a different view of copyright... which is basically they don't care. (ha! in a bruce sterling novel america is bankrupted overnight by a chinese satellite which distributes for free any, and all american intellectual property...)

the reasons you've mentioned amelia may be a factor, but i also feel that printed pages, paper-are just easier on the eyes to read, i don't think books will ever disappear.

Certainly anyone American who thinks intellectual property rights are silly is a fool. Entertainment is the USA's #1 export and has been for many years. If all other countries decided that creators' rights were irrelevant, then the US would be one broke ass nation.

Additionally, China may have more than its fair share of pirates, but it is entirely inaccurate to suggest that the Chinese do not care about copyright. When it comes to writing for example, it is far easier for a Chinese author to make full time solid income from writing and only writing. Some of this is because of the size of the population of China and the sheer enormity of the potential audience. But, if they didn't take care of their creative people, then their nation's writers would surely not be making a living at it.

I am not saying the internet should replace books at all. I love books. I am saying that people's cavalier attitude about writers' rights has made it so there is far less quality writing on the web than there otherwise naturally would be.

[Buster Friendly]

i feel like we're talking at cross purposes here... it's the sort of thing that feels like it could be handily resolved at 2a in a denny's over coffee, and hashbrowns... oh well.

the chinese as a whole really don't care about our copyright. it's a huge problem, even for them.

sorry to so brief, but i gotta run.