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It is unknown if and when the deal between Google and YouTube will be made

The Wall Street Journal has published a report that claims Google is in negotiations to buy YouTube for an undisclosed amount – some speculation has the price tag on the site at more than $1.6 billion. A source familiar with the talks also said that the current negotiations are at a “sensitive” stage and could be halted or setback at any given moment.

While better technology allows larger frames, higher frame rates and better resolutions, the acquisition would make sense from a Google standpoint. YouTube's audience mixed with Google's ability to market ads could put Google in a nice position in the emerging market for video advertising. As of September 30, YouTube has almost half of the online video search market – serving more than 100 million videos per day.

The deal would, however, have some downsides for Google. The first problem the company would have to deal with is that YouTube has been facing pressure to clean up blatant copyright infringement by its users. Universal Music, for example, has claimed that YouTube owes the company “millions” because of infringement.

A number of companies have been trying to woo the YouTube co-founders into selling the company. Viacom, which offered $750 million for Facebook last year, may have also offered to purchase YouTube. Micorosft, Yahoo and the News Corporation have also shown previous interest in YouTube.

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By mechwarrior1989 on 10/6/2006 11:32:29 PM , Rating: 4
Wait what? Google create it's own video service? You mean like No way! Why would google ever want to do that? That's crazy talk!

Anyways, a lot of people care about youtube and while it doesn't make money it does provide a service, something which Google has built it's business around. By acquiring Youtube Google takes away some of it's competition and also acquires all the videos which are on youtube and can implament it's own Google search stuff and make everyone's Youtube experiance much better. Google can also use it for sticking it's ads everywhere in order to continue to generate ad revenue. I would think a smart thing to do to get people to upload videos which people want to watch is to give directors a cut of the ad profits. I think that would probably work better than adsense in some regards.

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