Google buys YouTube in US$1.65b stock deal
Posted: 10 October 2006 0444 hrs
SAN FRANCISCO - Google on Monday announced a 1.65 billion dollar
stock deal to buy hot young video-sharing website YouTube.
"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," Google
chief executive Eric Schmidt said in a statement.
"Together, we are natural partners to offer a compelling media
entertainment service to users, content owners and
advertisers."
YouTube soared to online popularity after its launch in February
2005. The company claims that more than 100 million videos are
watched daily by visitors to the free website, which features
content provided by users.
"Our community has played a vital role in changing the way that
people consume media, creating a new clip culture," said YouTube
co-founder Chad Hurley.
"By joining forces with Google, we can benefit from its global
reach and technology leadership to deliver a more comprehensive
entertainment experience for our users and to create new
opportunities for our partners."
YouTube would continue to operate independently with its
headquarters in San Bruno, California, after the acquisition is
complete, according to Google. All of YouTube's 65 employees were
to remain with the company.
In unofficial Silicon Valley tradition, YouTube was launched on its
meteoric rise from a garage. It announced a first round of funding
of 3.5 million dollars from Sequoia Capital in November of last
year.
Google was to pay for YouTube with shares of its own high-flying
stock.
Analysts have touted a Google purchase of YouTube as a symbiotic
alliance.
By purchasing YouTube, Silicon Valley based Google would be able to
apply its proven prowess for generating revenue through online
advertising.
YouTube would provide Google traction in the online video-sharing
market, where Google's own service of that kind has failed to gain
traction.
- AFP /ls