But what I don’t get is why YouTube is worth $1.65 billion dollars? Towards the end of yesterday, Matt piped up when he saw the headline and said, “Wow, that’s like buying 3 small countries.” He was far off — more like 7. Or to put it another way, YouTube is worth more to Goggle than all of the Virgin Islands — population 108,605.
But why? Everyone says that it will be a “lucrative marketing hub,” but it has yet to monetize much of its 100 million videos served per day. It’s trying, don’t get me wrong, but they spend nearly $1 million dollars per month on bandwidth bills alone. It’s going to be a long, hard, uphill battle to make some cash for YouTube. Content partnerships with studios and record labels will help, but let’s not forget that YouTube is already hosting a lot of copyrighted content — which makes them a lawsuit magnet.
So, am I crazy? Is YouTube really worth $1.65 billion? Will it last long enough to find out?
