Google agrees to acquire YouTube for $1.65 billion
Google announced an agreement to acquire YouTube for $1.65 billion in stock, less than two years after the video-sharing site's creation. The deal gave the rapidly growing user-generated video platform the resources and commercial infrastructure of one of the world's largest internet companies.
Historical context
Online video was expanding quickly as broadband connections, Flash video and inexpensive digital cameras made uploading and watching clips practical. YouTube had achieved exceptional audience growth, while Google Video and other competing services had struggled to match its community and cultural momentum.
What happened
Google and YouTube announced the all-stock acquisition on October 9, 2006. YouTube was to retain its brand and continue operating separately, while gaining access to Google's infrastructure, advertising technology and financial resources.
Consequences
The acquisition validated web video and user-generated media as a major internet business rather than a peripheral experiment. It also placed YouTube inside an advertising and infrastructure company capable of financing the enormous bandwidth, rights-management and monetization requirements that accompanied streaming video at global scale.
Related people
Sources
- Google Buys YouTubeWIRED
- Google Has Acquired YouTubeTechCrunch