Comments on: YouTube could be a steal at $1 billion

news analysis Sony's acquisition of video-sharing company Grouper could mean big bucks to others in online video.

[ballssalty]

Is our attention span that short?

"Facebook is holding out for $2 billion, according to the magazine."

They are out of their minds if they think someone will pay $2 billion for a company whose revenues are probably in the low millions and losses in the tens of millions. Did we not learn the lessons of the last internet bubble from only 6 years ago???

They are going to regret not taking that $750 million (also way too much) offer.

[Fictia]

100% correct. They're not worth $750M...

They're playing the same game everyone else is playing: who can hold their breath underwater for the longest amount of time... All the players are chickensh__ to be the first to monetize themselves because they wanna learn from someone ELSE'S "growing pains" mistakes and of course they are afraid of knowing the real value of themselves, much much lower than $750M...

[thedreaming]

There's an old saying...

"There's a sucker born every minute" I'm sure someone right now is thinking of buying it.

[joshhyde]

It' all about the software

Sony bought Grouper for their P2P software. The site is just a bonus.

[www.ConstantClick.com]

Jean-Pierre Khoueiri & YouTube.com

It seems that youtube.com is interested in selling soon. Maybe
ConstantClick.com will put a bid in. If they bid more than a 1
billion they've pverpaid.

[disco-legend-zeke]

Without Net Neutrality, Video sites will be slaves of TEL-CABLE duopoly.

this morning i saw the first of the deceptive TV ads urging voters to call their congressmen to vote no on NET NEUTRALITY.

It is evilly ironic the the headlines for the commercial shout YOUR CONGRESSMEN WANT TO BLOCK CHEAPER CABLE...

AHAHAHAHAHAHAHAHAAHAHAHAHAAH....

[jabbotts]

saddly, the masses wil believe it

They always do. A snappy advert campain and the intellectually lazy will eat it up.

Gosh, the TV said it was true.. you mean everything on TV isn't true?

[hybris06]

Right On

I use facebook, being a recent college graduate, and when I read they passed up $750 million my jaw dropped. They are just being plan old greedy. Considering that they have such a questionable business model they should have taken the money and run. Even after venture capitalists take their share, the founder (Mark Zuckerberg) will be left with at least a couple hundred million. How much money does he need?

[Fictia]

The more I think about it, the more it sounds like a scam

It has to be that the people at the top of the "bidder" and FaceBook are somehow related. If they had 5 bidders then yeah... How about they put themselves up for sale on eBay and we see their REAL value? ... I personally think they'll take even $200M...of a legitimate offer.

[Don_Dodge]

Extrapolating to a billion dollars

Grouper, a P2P video sharing company was recently purchased by Sony Pictures for $65M and they had about 1% market share. YouTube has 43% market share...so they are worth $1B. No, make that $2.6B. This kind of crazy logic is what fueled the last bubble and led to its bursting.

Sony Pictures bought Grouper for its P2P technology platform which can be used for other things like distributing its vast video catalog in a cost efficient way. The Grouper web site and user base were just frosting on the cake...that they may throw away.

Video sharing sites and services are hot now. There are new services emerging every week. The technology is simple. There is no significant barrier to entry. YouTube was founded in February 2005...just 18 months ago.

I was a VP at the original Napster. YouTube has many similarities. I wrote a blog on this subject today. http://dondodge.typepad.com/the_next_big_thing/2006/08/youtube_worth_a.html

Will history repeat itself?

[disco-legend-zeke]

Traffic is the New Currency.

in the previous bubble, companies grew valuation on traffic, with no firm future revenue stream.

Even YAHOO was only 23 cents a share. Then, in a mainstream sort of way, advertises saw that they could recapture lost TV eyeballs. Then, the process was egalitized by google adwords and yahoo publishing, so the smallest website can be monetized.

Yes, traffic _is_ the new currency. Content (which users really love to provide for free in utbe, myspage, etc.) is the new Wealth, and bandwidth is the expensive fuel needed to run that engine. I hear YouTube spends a Megabuck a month on bandwidth. That would double if the Incumbents have their way.

<include>my Net Neutrality rant.</include>

[Jasonkx]

Sony just bought YouTube for $65 million

I think that Sony realized that with practically no barriers to entry, they have effectively just bought YouTube for $65 million.

Sony has a huge catalog of film clips, concert footage and music videos. With all that content, it will be a piece of cake to build an audience. All they needed was the technology platform. Sony doesn't need a video of your cat to be popular.

With the loss of so much record store traffic lately (note the Tower Records bankruptcy) and the great in-store promotions that gave sony records, they need more promotion channels. This creats a new one for them on the web.

The extrapolation to $1 billion is silly.

[Hardrada]

Market-share is worthless...

...paraphrasing what you said into my post title. See a more responsible analysis of this acquisition by Cringely here:
http://www.pbs.org/cringely/pulpit/pulpit20060824.html

Think of how much Sony will be filing suits against YouTube once users start stealing videos from Grouper and posting them on YouTube.

[Fictia]

I've got a ton of original content I'm holding-on to

Waiting for the bubble to explode and for a sensible online broadcaster to come along and give me the solution I want: I get at least 5% of profit he makes from my content via any means he chooses that'll make my total sum profit highest. Meaning, I'd pick a 5% profit giver over a 50% profit giver if the 5% is smart enough to lure 20x more viewers while sticking to them more commercials at higher cost to the ad company...

YouTube could be worth $1B or it could be worth $50M - the only way to know is once its monetized (via commercials) and REAL supply&demand works its way. Giving stuff for free will ALWAYS have unnaturally high demand.

[disco-legend-zeke]

AD REVENUE SHARING (let google manage it, 3-way split)

The most difficult part of being an artist is finding a way to monetize you creative output.

Since i was already making web pages, when Google adsense came along, the checks started coming in immediately.

I agree with fictia, if you have good content, it is foolish to give it away. I have thought about some kind of ad revenue sharing for my photo web sites. If google would do the reporting and paying, i won't even have to waste hours of time figuring out 1099 forms, etc.

I do use free content sites, however, and in return for my content (i don't see any 5 cents a word checks from CNET for my deathless prose in their comments, for example) i get an increase in "Google Juice" as well as actual traffic.

Giving stuff away free attracts thieves who, after all, are, by definition, people that want things free. It also provides a creative venue and SOCIAL NETWORKING. Myspace is not really "FREE," after all, it is ADVERTISER SUPPORTED. So their problem is to keep advertising revenues ahead of bandwidth costs.

<--! paste net nutrality rant here -->

[hudsonperalta]

Facebook is holding out..... LMAO

"Facebook is holding out for $2 billion, according to the magazine."

WHAT A JOKE! Viacom must have not even visited the stupid site when they put that bid in. I wouldn't give Facebook a dollar and a pack of gum for their site.

Tell you what, give me $750 million and I'll bet my life I can make a site like MySpace, and get it more hits then Facebook.

[RicRicho]

Learning from Flickr.. path to profitability

YouTube is an honest to goodness great idea. An idea who's time has come. And after loading a half dozen 5 minute movies to it myself I would easily pay for an escalating range of priviledges/ services in the style of Flickr. Unlimited storage and a few extra services... also corporate licenses are in the offing too.
See examples at richoblog at blogspot.com.
RicRicho is a handle for technologist Ric Richardson.

[thetiger1974]

Youtubes competition

What do you think about all the new online contest sites like googlesidol.com i think its called nbc?s star tommorow myidolworld.com and the other video sites. How will these sites affect the market that youtube has.