So, the rumor was founded and Google yesterday evening confirmed it had acquired YouTube for $1.65bn in stock !
For the video sharing site launched in February 2005, and who had raised about $11M, that's a pretty impressive achievement. It had managed to grab almost 50% of the online video market, ahead of MySpace, with Google a very distant third player. 100 Million videos viewed a day, that indeed blows my mind away ! Didn't I say several months ago that video was the next big thing ?
Although $1.65 is very rich by all measures, Google share did not tumble in after market hours (just inching down), so investors don't seem to be much concerned by the acquisition price.
Google had been criticized on relying too much on advertising tied to keywords. Here's a new fast growing source of trafic and advertising possibilities and a way to compete against the other star of the moment, MySpace. The combination of Google Internet prowess with YouTube video stream will intrinsically be very powerful and interesting to watch. Microsoft, Yahoo and NewsCorp must react.
Will Google manage to monetize YouTube trafic in a way it pays for the acquisition, and how, this of course remains to be seen. However, Google has proven they are masters in monetizing trafic more and better than anybody else in the business. So, as I'm concerned, I do think this deal makes sense for both companies : Google acquires a strong brand name and a huge trafic, YouTube teams up with fantastic technological and monetization skills.
Sure, $1.65bn is a price, but that will make no dent in Google's cash position as it's an all stock deal and Google itself is pricey (P/E of 60+, though PËG is a mre reasonable 1.44).
Update 4PM : stock market salutes the acquisition : Google is up slightly while Yahoo and Microsoft are down (googmic Index up to 43%).
Update 10 PM : Google eventually inched down 0,6% but Yahoo lost more than 2%. Yahoo is now at its lowest point in more than 2 years. In the same time, Google has jumped about 300%...
Je donne quelques informations sur mon blog.
http://impressions1.blogspot.com/
Posted by: Daya | October 10, 2006 at 11:54 PM
Google est actuellement valorisé 20x l'EBITDA. Si on applique donc ce multiple a l'EBITDA de YouTube, la valorisation de ce dernier serait donc proche de $1.4 Mds. La rude compétition livrée par les différents acquéreurs potentiels expliquerait le "premium" de $ 200M
Posted by: Cooly | October 11, 2006 at 11:09 PM