Kamla Bhatt

The deal is done.  Google has agreed to acquire YouTube for $1.65 billion.

 According to a press release from Google:

“Google Inc. (NASDAQ: GOOG) announced today that it has agreed to acquire YouTube, the consumer media company for people to watch and share original videos through a Web experience, for $1.65 billion in a stock-for-stock transaction.  Following the acquisition, YouTube will operate independently to preserve its successful brand and passionate community.

The acquisition combines one of the largest and fastest growing online video entertainment communities with Google’s expertise in organizing information and creating new models for advertising on the Internet. The combined companies will focus on providing a better, more comprehensive experience for users interested in uploading, watching and sharing videos, and will offer new opportunities for professional content owners to distribute their work to reach a vast new audience.

“The YouTube team has built an exciting and powerful media platform that complements Google’s mission to organize the world’s information and make it universally accessible and useful,” said Eric Schmidt, Chief Executive Officer of Google.  “Our companies share similar values; we both always put our users first and are committed to innovating to improve their experience. Together, we are natural partners to offer a compelling media entertainment service to users, content owners and advertisers.”

TechCrunch broke the news first and you can read more about the deal on their site. Marshall Kirkpatrick has a post on how Sequoia stands to gain from this deal. Sequoia is a backer of both Google and YouTube. 

News.com’s article provides a background to the acquistion and an analysis of the deal.

New York Times article on YouTube touches some key points like why Google decided to acquire YouTube, the bootstrap success story of Google and YouTube  (and Napster) and that great common factor: Sequoia Capital, the VC firm.

What about copyright issues? Financial Times addresses the copyright issue in their article. 

For a while now a streaming media industry expert has been urging me to read the Digital Millennium Copyright Act (DCMA) to help me better understand  copyright issues etc for video sharing companies. DCMA is pre-Napster. Reading through the entire DCMA might be a bit of an uphill task, but here are a couple of articles that are like literature review and provide a good basic understanding of DCMA, copyright etc. etc.

This is  an article on DCMA and YouTube that provides some background information about the topic. And this Wall Street Journal article talks about DCMA and the safe harbor clause.

Back to GoogleTube. I don’t know about you, but this deal sure does remind me of the early dotcom days when Yahoo and Excite got funded…anyone remember that story?  Excite got acquired by AT&T and become Excite@Home and moved to a shiny new building on 101 and then went out of business.  It sure does feel like 1997-1998 all over again…. anyone remember those online pet stores or WebVan?

There are some more video-sharing companies out there…wonder what will happen to them? I wonder what is going through the minds of folks in Redmond (Microsoft) and Sunnyvale (Yahoo)…