"What a great site! I'm impressed by the great stuff you've pulled together. It merely confirms my long-held belief that economics CAN be interesting....
All the best"-
Charlie Wheelan,
aka The Naked Economist
The NPR report makes it pretty clear why YouTube has sold for over $1 billion, and why that purchase was worth it. YouTube has tens of millions of viewers worldwide a day, which with Google's advertising techniques will obviously bring in large revenue. However, more important is the point made about the 'sense of community' YouTube presents. All the other aspects of Google are largely information/search based, and don't involve interaction between individuals (except Google Video, which is essentially the same thing as YouTube, but isn't as popular). With Google's major competitor, Yahoo, aiming to producing a sense of community between users as a way to come out ahead, buying YouTube is a smart move. Also, the overwhelming success of sites like Myspace and Facebook show that this 'community' online can be very popular, and can make a lot of money.
We hear a figure like 1.6 billion and are skeptical. How could a web site be this valuable and how could a couple of kids who made it be getting this lucky? Although we may be jealous of them, these guys do deserve the money because they have the unique humal capital required to produce something very rare. Only a few websites in the world are true online communities. These 20-somethings are one of only a few people in the world who have been able to acheive this, therefore, they are rewarded with this kind of money.
It is quite obvious why the youtube system is so valuable; google is capable of taking full advantage of its advertising potentials since it is such a communal site. I know if I am looking for an easy way to download a video, I go straight to youtube. Thus, google was lucky enough to stumble upon this treasure since it is a highly desired tool because of its easy access and widespread use.
The youtube system is so valuable because it's a ability to draw in people and to set up an interesting online community that allows people to upload or download any type of videos,there are millions of people that visit youtube daily and the purchase of it by google is only a prosperous investment because through google's effective advrtising techniques the views of youtube vidoe's is only going to increase
I think that the former youtube owners should have held out for more money from google. while 1.6 is obviously a lot of money, youtube is clearly worth more than 1.6 billion dollars due to the "community" it draws in and google clearly has a lot of interest in it (seeing as how youtube offers everything that google does not have and wants), and were probably willing to pay more for it.
Just as a quick aside to the people of NPR.org, it is not possible to download videos directly from the website. This is an unimportant and trivial note acept that it is much a part of youtube's genius. The videos, once uploaded come through as a streaming format, and can not be saved to the computer. this allows for dramticly quicker load times as well as the necessity to revist youtube everytime a video is requested. Both are qualities that have made youtube significantly more successful then its competition. however if you are turly determined to get your video it is possible to download a streaming video recorder/player here: http://javimoya.com/blog/youtube_en.php
It's pretty obvious why Youtube.com is going for $1.65 billion. The owners probably could have made more if they waited longer, since Google video is not even close to being as good as youtube. The three "20-somethings" should be rewarded with this fat paycheck, because they have created a simple, productive and friendly website. I use youtube a lot to watch my favorite sean paul videos (Sean-A-Paul...so mi go so then) and its SO EASY and i love the Communal atmosphere = P.
P.S. Pierce should be given credit because House of Kellys is his proper name.
Youtube is unique because instead of just having a site that is devoted to one thing (google which is simply used as a search engine) it is also a place to "hang out" as the news report states. This and the many other conveniences of youtube make it worth 1.6 billion dollars. Although they may have made more money if they decided to apply marketing strategies similar to google's it was smart to sell it for such a high price and allow the google company to handle the marketing.
I totally understand why google bought youtube cause its definately a great opportunity to increase the number f ppl and number of times those ppl see the advertisements that they sponsor. but i dont understand why the you tubers would sell the site. sure they made 1.6 billion right off the bat but why didnt they just do to their site what google is panning on doing and keep all the future pfrofits for themselves?I'm sure google wouldnt have bought it for that much if they couldnt hmake more than that amount easily from the site, so the former owners probably got a raw deal.
You Tube going for 1.65 billion is a lot, but it is a justified acquisition by Google. This is because Google specializes in advertising in that their primary website makes its profits from it. This means that google will be able to tap into the huge user base that You Tube has for advertisements. Google had its own version of a You Tube, (google video) but it was no where near as successful as You Tube. So if Google couldn’t out compete You Tube then why not buy them out and make your competitor your own strength. A similar thing was done when E-Bay bought Pay-Pal after a failed attempt at its own money transfer website.
You Tube should have asked for more money from google or waited a little longer to sell it so they can make more money, because even though there is a vast amount of videos the popularity You Tube cant happen from one day to the other. But after buying You tube google will be making a bigger profit than ever.
This deal shows that different companies have different strengths, and when put together, the combinations can be very profitable. Google, like an internet wal-mart that is beginning to eat up everything in its way, now seems to have made a further stimulus for people to visit their site, and not only will there be "more people" in an abstract sense, a whole online community is virtually guarateed to be on the website. Perhaps this would be the equivalent of a TV station buying higher ratings to charge more for advertisements, but in any case 1.6 bil to YouTube, and kudos (and beyond) to Google.
I understand that 1.6 billion is a hefty amount of cash, but i just dont understand how selling a business works. Do the creators of youtube get the 1.6 billion and then get lost, never to be seen or given money again? or do they still get some of the profit from their sold business? I guess 1.6 divided by 3 would be enough to support these 20-somethings most likely for the remainder of their lives, but wouldnt it be even better to hold onto the business and have a steady flow of cash to always count on?
i think the mass power behind youtube is souly in how many people view it a day. without the vast number of people from around the world opening this site they exposer on youtube would be pointless the money that is to be made through internet advertising is emence and probably the #1 reason in my mind to purchace something like youtube, wheather that is worth more than a billion dollars would need much more of my consideration
the people that created u tube should hold on to u tube for a bit longer bc some1 is probably able to offer them a lot more money for something they created for free...this web site is probabl just one of those fads like myspace that will not be used that much anymore in a while but for the next couple of years this web site will be hot so they should have held on to it longer so they could get more money out of it.
I think that the guys from youtube got a somewhat raw deal here. i nean sure they get 1.6 billion dollars but isnt it reasonable to conclude that if google is willing to pay that much money for the site then google will probably make much more than that amount in the long run. why didnt the youtubers just start putting adds in themsleves like google wants to do? Couldnt they have gottne much larger profits long term if they did that instead of getting one big payment and then getting nothing more?
17 comments:
The NPR report makes it pretty clear why YouTube has sold for over $1 billion, and why that purchase was worth it. YouTube has tens of millions of viewers worldwide a day, which with Google's advertising techniques will obviously bring in large revenue. However, more important is the point made about the 'sense of community' YouTube presents. All the other aspects of Google are largely information/search based, and don't involve interaction between individuals (except Google Video, which is essentially the same thing as YouTube, but isn't as popular). With Google's major competitor, Yahoo, aiming to producing a sense of community between users as a way to come out ahead, buying YouTube is a smart move. Also, the overwhelming success of sites like Myspace and Facebook show that this 'community' online can be very popular, and can make a lot of money.
We hear a figure like 1.6 billion and are skeptical. How could a web site be this valuable and how could a couple of kids who made it be getting this lucky? Although we may be jealous of them, these guys do deserve the money because they have the unique humal capital required to produce something very rare. Only a few websites in the world are true online communities. These 20-somethings are one of only a few people in the world who have been able to acheive this, therefore, they are rewarded with this kind of money.
I will publish it if it is good, but not give any credit for students who do not give their proper names.
It is quite obvious why the youtube system is so valuable; google is capable of taking full advantage of its advertising potentials since it is such a communal site. I know if I am looking for an easy way to download a video, I go straight to youtube. Thus, google was lucky enough to stumble upon this treasure since it is a highly desired tool because of its easy access and widespread use.
The youtube system is so valuable because it's a ability to draw in people and to set up an interesting online community that allows people to upload or download any type of videos,there are millions of people that visit youtube daily and the purchase of it by google is only a prosperous investment because through google's effective advrtising techniques the views of youtube vidoe's is only going to increase
I think that the former youtube owners should have held out for more money from google. while 1.6 is obviously a lot of money, youtube is clearly worth more than 1.6 billion dollars due to the "community" it draws in and google clearly has a lot of interest in it (seeing as how youtube offers everything that google does not have and wants), and were probably willing to pay more for it.
Just as a quick aside to the people of NPR.org, it is not possible to download videos directly from the website. This is an unimportant and trivial note acept that it is much a part of youtube's genius. The videos, once uploaded come through as a streaming format, and can not be saved to the computer. this allows for dramticly quicker load times as well as the necessity to revist youtube everytime a video is requested. Both are qualities that have made youtube significantly more successful then its competition. however if you are turly determined to get your video it is possible to download a streaming video recorder/player here: http://javimoya.com/blog/youtube_en.php
It's pretty obvious why Youtube.com is going for $1.65 billion. The owners probably could have made more if they waited longer, since Google video is not even close to being as good as youtube. The three "20-somethings" should be rewarded with this fat paycheck, because they have created a simple, productive and friendly website. I use youtube a lot to watch my favorite sean paul videos (Sean-A-Paul...so mi go so then) and its SO EASY and i love the Communal atmosphere = P.
P.S. Pierce should be given credit because House of Kellys is his proper name.
Youtube is unique because instead of just having a site that is devoted to one thing (google which is simply used as a search engine) it is also a place to "hang out" as the news report states. This and the many other conveniences of youtube make it worth 1.6 billion dollars. Although they may have made more money if they decided to apply marketing strategies similar to google's it was smart to sell it for such a high price and allow the google company to handle the marketing.
I totally understand why google bought youtube cause its definately a great opportunity to increase the number f ppl and number of times those ppl see the advertisements that they sponsor. but i dont understand why the you tubers would sell the site. sure they made 1.6 billion right off the bat but why didnt they just do to their site what google is panning on doing and keep all the future pfrofits for themselves?I'm sure google wouldnt have bought it for that much if they couldnt hmake more than that amount easily from the site, so the former owners probably got a raw deal.
You Tube going for 1.65 billion is a lot, but it is a justified acquisition by Google. This is because Google specializes in advertising in that their primary website makes its profits from it. This means that google will be able to tap into the huge user base that You Tube has for advertisements. Google had its own version of a You Tube, (google video) but it was no where near as successful as You Tube. So if Google couldn’t out compete You Tube then why not buy them out and make your competitor your own strength. A similar thing was done when E-Bay bought Pay-Pal after a failed attempt at its own money transfer website.
You Tube should have asked for more money from google or waited a little longer to sell it so they can make more money, because even though there is a vast amount of videos the popularity You Tube cant happen from one day to the other. But after buying You tube google will be making a bigger profit than ever.
This deal shows that different companies have different strengths, and when put together, the combinations can be very profitable. Google, like an internet wal-mart that is beginning to eat up everything in its way, now seems to have made a further stimulus for people to visit their site, and not only will there be "more people" in an abstract sense, a whole online community is virtually guarateed to be on the website. Perhaps this would be the equivalent of a TV station buying higher ratings to charge more for advertisements, but in any case 1.6 bil to YouTube, and kudos (and beyond) to Google.
I understand that 1.6 billion is a hefty amount of cash, but i just dont understand how selling a business works. Do the creators of youtube get the 1.6 billion and then get lost, never to be seen or given money again? or do they still get some of the profit from their sold business? I guess 1.6 divided by 3 would be enough to support these 20-somethings most likely for the remainder of their lives, but wouldnt it be even better to hold onto the business and have a steady flow of cash to always count on?
i think the mass power behind youtube is souly in how many people view it a day. without the vast number of people from around the world opening this site they exposer on youtube would be pointless the money that is to be made through internet advertising is emence and probably the #1 reason in my mind to purchace something like youtube, wheather that is worth more than a billion dollars would need much more of my consideration
the people that created u tube should hold on to u tube for a bit longer bc some1 is probably able to offer them a lot more money for something they created for free...this web site is probabl just one of those fads like myspace that will not be used that much anymore in a while but for the next couple of years this web site will be hot so they should have held on to it longer so they could get more money out of it.
I think that the guys from youtube got a somewhat raw deal here. i nean sure they get 1.6 billion dollars but isnt it reasonable to conclude that if google is willing to pay that much money for the site then google will probably make much more than that amount in the long run. why didnt the youtubers just start putting adds in themsleves like google wants to do? Couldnt they have gottne much larger profits long term if they did that instead of getting one big payment and then getting nothing more?
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