Google buying Youtube

Market is buzzing with rumours that Google is making an offer for Youtube for US$1.6B. As of last checked, there are over 800 news article similar to the one on International Herald Tribune:

The Internet search leader, Google, is in talks to acquire the popular online video site YouTube for about $1.6 billion, The Wall Street Journal reported, citing a person familiar with the matter.

US$1.6b is possible since the shareholders of Youtube had made it pretty clear that they wont sell it for anything less than US$1.5b.

Making it more interesting is the fact that Mark Cuban just made a comment that “Only a ‘moron’ would buy Youtube” on CNN Money a few days ago:

Cuban, co-founder of HDNet and owner of the NBA’s Dallas Mavericks, also said Thursday that YouTube would eventually be “sued into oblivion” because of copyright violations.

“They are just breaking the law,” Cuban told a group of advertisers in New York. “The only reason it hasn’t been sued yet is because there is nobody with big money to sue.”

Did Cuban just called Google a “moron”? Perhaps there is a bit of self-interest (Cuban founded HDNet) but not totally baseless either:

“There’s a lot of pirated material on that,” NBC Universal Chief Executive Bob Wright said of YouTube last week. “It will catch up with them. It has a little bit of the Grokster kind of appearance and feel. They kind of know it. We know it.”

Since we are on the topic of Youtube, the whispering among the network engineers (esp. in NANOG) is how much bandwidth Youtube is consuming and the engineering challenges around it. Bill Norton was kind enough to forward me his latest paper title “Internet Video Next Wave Disruption” and there is a nice diagram there.


YouTube, a one-year-old community-based short video sharing service, shared that in February 2006 they are buying transit for 20Gbps of video traffic! Their growth rate, shown graphically below, was documented as 20% compounded monthly!

20% compounded monthly = 891% growth yearly. If they consumed 20Gbps in Feb 2006, by Feb 2007 next year, they would need to buy 178Gbps of bandwidth! Wow!

We almost forgot that Youtube is just a 1.5 year old company. US$1.6B in 18 months, yea, I have to give it to them. *salute*

* Bill Norton was in Singapore on thrusday to present his paper but unfortunately I was not in Singapore then. But he was kind enough to forward a copy of his paper before his talk. Thanks Bill…lets catch up another time.

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