Its been a while, but felt like I had to post today on what must surely go down as one of the biggest deals of Internet 2.0. Well you have heard, right – Google acquired You tube in a straight stock swap worth $1.65 billion, yes that is with a ‘b’ ! What is Google doing acquiring a company with 60 employees and really no revenues so far. Here is the DM News take on it.
Here is what I think Google is doing a land grab on the internet and is making a pretty good fist of it so far. They are like any traditional company – brick and mortar and all, utilzing their abundant cash reserves to keep out all forms of competition by creating an empire in the online space that no marketer can really ignore. First the deal with MySpace.com, that darling of web based social media and now You tube. The message is strong and clear either build it yourself (as they did reasonably succesfully with Gmail as a late though clearly viable contendor to Yahoo Mail and Hotmail), or partner with it (MySpace) or buy it (Youtube).
What is going to be interesting is to see whether Google can continue to monitize these new properties, the way it has done such an exceptional job of monetizing its search franchise. I personally think they are very well placed to do exactly that. The beauty of Google’s machine is not the search itself, but I think its the ease of use of its advertising system, which has made it so easy for anyone to come and democratically (sic!) bid on ads anywhere on the web. And that in my humble opinion is going to be what will make Google a true search ++ company. Of course as always watch this space.
