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Google very much ink deal with YouTube to the tune of $1.5 billion

With hardly enough time to draw breath between curious rumour and putting ink to cheque, Google have indeed bought YouTube.

“As Google put it in when announcing the buy, ‘The acquisition combines one of the largest and fastest growing online video entertainment communities with Google’s expertise in organizing information and creating new models for advertising on the Internet.’”

But let’s go back a day and see what else was happening:

“YouTube has won. The company today announced a flurry of deals with music labels to offer music videos and other content free of charge, including one with onetime nemesis Universal, which recently claimed that YouTube owed it millions of dollars for copyright infringement. In addition to the Warner deal announced two weeks ago, YouTube has now signed on Sony BMG, Universal, and CBS.”

Are we to presume that Google may have had a hand in this, albeit a hidden one? After all, the prospect of Google taking stewardship of YouTube may have greased the wheels somewhat.

“Google also brings something unique to the table: their AdSense network. In the future, Warner’s video content will also be made available to Google’s AdSense partners, potentially enabling anyone to build a music video service, with the revenue to be split among the site, Google, and Warner.”

Now that’s what I was looking for .. the deal behind the deal. As I’d imagined, with Google pushing into video adverts, exploring the possibilities of embedding adverts into music videos and the like was just too tempting for Larry, Sergey & Co.

But what of the third man Apple? Where do they fit into all of this, if indeed they fit in at all?

While it’s clear Apple isn’t going to be any direct or at least immediate financial beneficiary of this recent transaction, thinking ahead, YouTube was either going to go legitimate, or go bust. Or, get bought out by someone other than Google (ehem, Microsoft) and be made legitimate by fair means or foul.

However, I’d like to think that with Apple and Google being a little closer these days, some arrangement with regards to video content might not be outside the realms of reality. After all, both Apple and Google have deals with the major labels, so such arrangements might be seen as being organic to their respective deals.

On the downside, YouTube will lose some of its audience once the suits move in, but then with all of the added cache that comes with being owned by and partnering with such industry heavyweights as Google, Sony BMG, Universal, and CBS et al, there’s the added bonus of having your brand pushed into the face of an entirely new audience, one with money to spend.

So where to next? Where does all of this lead to?

I’ll let you know just as soon as I know…

By Wayne Smallman

Wayne is the man behind the Blah, Blah! Technology website, and the creator of the Under Cloud, a digital research assistant for journalists and academics.

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