Google in Talks to Acquire YouTube for $1.6 Billion

October 6, 2006 at 7:14 pm (China, Internet, US)

After Yahoo’s attempt to acquire Facebook, a much bigger acquisition is on the way.

 

From The New York Times

Google is in serious talks to acquire YouTube, the wildly successful online video-sharing Web site, for $1.6 billion in cash and stock, people involved in the negotiations said today.

A deal would end an almost yearlong chess game among the nation’s media and technology moguls to take over YouTube, which allows users to share home movies, amateur spoofs and snippets of the best parts of television shows. Though it is not yet profitable, the site has exploded into a cultural phenomenon less than a year after its debut, broadcasting more than 100 million video clips a day.

Microsoft, Yahoo, Viacom and the News Corporation, among others, have all paid visits to YouTube’s headquarters in San Mateo, Calif., in recent months to inquire about buying the company.

Terms of the potential sale to Google could not be learned. It was still possible that the talks could collapse or that another suitor could swoop in with a rival offer.

The negotiations come as all of the established media conglomerates are in a frenzied hunt to acquire hot Internet properties. Yahoo, for instance, is in negotiations to buy Facebook, a social networking site originally aimed at college students, for more than $1 billion, according to people involved in those talks.

The buyout rush is partly a reaction to Rupert Murdoch’s acquisition of MySpace, an online hangout with millions of personal Web pages. MySpace, which Mr. Murdoch bought last year for $580 million, is now worth as much as $2 billion by some analysts’ estimates.

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