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« links for 2006-10-10 | Main | Nice quote about instant messaging/e-mail »

Dear Mr. Moritz...

Please bottle some water from your house and send it to me.

Hair clippings for me to wear as a good luck charm will also do.

 

Some people just have the magic touch...Google, Paypal, Yahoo!, and now YouTube, which just got acquired by Google.

 

We don't really need more money, but if you want to throw a token investment our way, I'm sure we could make some room for you in the cap table somewhere.

I don't really know what to make out of this deal.  Google has the money to spend, and I think this is a better investment than putting up municipal wifi towers up.  What else could they spend it on? 

The upside is that this is a foothold into our video/tv viewing experience and the associated ad revenue.

The downside is that they haven't proven that they quite understand how to do community yet. 

What's fascinating to me is that, at the time of the del.icio.us acquisition, they were "split internally" on whether to make an offer.  How they managed to spend a billion six on such a big question mark is beyond me, just from a decision making point of view, whether or not its a good idea.

Reader Comments (4)

i have been short google for a day, and although i am down, i love the trade. i believe the main reason for such a large acquisition is because they feel that their stock price is extremely over valued.
October 9, 2006 | Unregistered Commenterjeremy
google seem more able to do deals in the $1b space (aol, dell, youtube) while yahoo seems more able to do the $10m-$40m deal - jumpcut, delicious, flickr)

will this jump yahoo into facebook deal... which has alot more downside than youtube if u ask me.. i think the copyright issues will actually be the best pre-sell marketing campaign ever.. studio complains or goes to sue on copyright and ends up with a google video and text ad serving deal :)
October 9, 2006 | Unregistered CommenterBen Barren
I also think Facebook has more upside, too. If they could find a way to open it up, and then allow people to do useful things on it like search for jobs, keep friendly, but professional contacts, but also make it feel private and allow me to show different faces to different people, it could be very powerful.

Search for someone, go right to Facebook... find who they allow you to see themselves as... that could be very interesting to me. I can clearly paint a picture as to what a multi billion dollar facebook would be to justify that value... as for YouTube, its a bit more amorphous to me and risky b/c of the bandwidth and legal issues.
October 9, 2006 | Unregistered CommenterCharlie
I swear I saw a bottle of water belonging to Mike Moritz on eBay. Web 2.0 startups are bidding with VC cash to buy it. ;-). I think the deal makes sense for a ton of reasons (Though there are some huuuuge potential risks):

1) Google agreed to pay myspace 900 million over 3 years for an ad deal. Google doesn't own any of myspace from the deal, doesn't have control over it, etc. Google paid 700 million more for a property in my mind that is equally as valuable, and they get to own it (myspace is the king of social networking, youtube is the king of video). Google will make the money back. We all thought myspace was ridiculous at 580 mil a year ago, now NewsCorp has already shown projections to make more than their money back in 36 months or so.2) They blocked the other big players. Microsoft, Yahoo! (who was in on the bidding until the last second) are now very far behind in the game.3) Google now has a way to enter your living room aka via Video/youtube. the web as we know it in its current form (browser, webpages,"webtv") won't be entering the living room, thus locking Google out if the living room as an advertising platform. With youtube, they can utilize video as the trojan horse to enter the living room with a contextual advertising platform for video. My longshot prediction: youtube/googtube videos available via iTV on your television in Q1 2007. If that occurs, I also predict a large drop in productivity for startups in Q1 2007 :-).4) Google can now become a real content company. We all know google video just wasn't cutting it. The big guys try to beat the immensely popular startups and they either win, take over where the startups left off when they've failed, or in Google's case here, buy them since they cannot beat them.

Long coment, I know, but the post and the comments just prompted me. All the other blogs are the same thing over and over, so it was nice to see something different than: GoogTube!!!!!!! OMGZ. ttyl.

-J
October 9, 2006 | Unregistered CommenterJason L. Baptiste

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