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YouTube Won't Sell For Less Than $1.5 Billion

Posted by ryuzaki0 on from the quite-a-few-flash-ads dept.

Joel from Sydney writes "According to a report in the New York Post, YouTube has informed potential buyers it won't be sold for anything less than $1.5 billion. The report lists Viacom, Disney, AOL, eBay and News Corp as potential buyers. Given that News Corp purchased MySpace last year for $580 million, is this a realistic figure?" From the article: "YouTube's stated business model is to 'pursue advertising,' but potential advertisers might be skittish considering industry estimates that roughly 90 percent of the content viewed on its site violates copyright laws. And at least one giant, Universal Music, is threatening to sue the company if its artists' songs keep appearing there. As it tries to focus on videos that don't use content owned by media companies, it yesterday launched the YouTube Underground, a contest to 'discover the most talented unsigned bands and musicians on YouTube,' backed by Cingular Wireless, Gibson Guitar and ABC's 'Good Morning America.'"

13 of 178 comments (clear)

  1. Web 2.0 ... by DreddUK · · Score: 2, Interesting

    ... so now we've got

    1. Create service
    2. Get other people to violate copyright with your service
    3. Avoid Lawsuits
    4. ???
    5. Profit (or at least $1.5B)

    I'd really love to have seen their pitch to any VC firms ;)

    --
    "If A equals success, then the formua is A=X+Y+Z. X is work. Y is play. Z is keep your mouth shut" - A Einstein.
    1. Re:Web 2.0 ... by hackstraw · · Score: 4, Interesting


      Wow, now its a 5 step plan, pretty soon 12 :)

      Yeah, we all laughed at the sock puppet and the Superbowl ads, but there is still mega-profit in the .com world.

      The coolest thing is that I heard on the news the other day where people at the other megacorps are realizing that there is profit in copyright infringement. Madonna's people are OK for uploaded stuff on youtube because they realize its free advertising. Much like the bands that allow taping of their concerts (we are looking at you Bob Weir). Who knows, maybe we can soon buy music in unencumbered digital formats at real market value. Maybe.

    2. Re:Web 2.0 ... by DreddUK · · Score: 2, Interesting

      So it turns in the insurance business equivalent of:

      Broker: Sure we'll insure your car.
      Client: Great, how much?
      Broker: $100,000 for this year.

      In other words, we don't want your business, but we don't want to tell you to your face. We'll just make our offer so astronomically high, you'll go quietly away.

      Saying that, shouldn't they have made their figure $3 billion or something. £1.5B seems like they might get a bite.

      --
      "If A equals success, then the formua is A=X+Y+Z. X is work. Y is play. Z is keep your mouth shut" - A Einstein.
  2. If you consider Yahoo buying Broadcast.com.... by postbigbang · · Score: 4, Interesting

    for about $2B, then it's not so much. And Broadcast.com (Mark Cuban's "invention") didn't really work yet. And I'll bet he's grousing that his current HD venture can't get that figure because it's not as evolved, and certainly not as popular as YouTube.

    The price is huge, but it's not out of line with web-based social properties. Not that it's fair.... but the future revenues if it's managed well could be very big.

    --
    ---- Teach Peace. It's Cheaper Than War.
  3. It will go the Napster, Kazaa, eDonkey way by SanderDJ · · Score: 5, Interesting
    The first time I looked at YouTube was not so long ago. I was shocked to see how easy it was to find complete video clips, including the copyright notice at the end.

    Really, enjoy it while you can, because the record companies will sue YouTube into the ground. Soon.

    So this company will not be worth anything in a year.

  4. Re:Realistic? by DreddUK · · Score: 3, Interesting

    True, but isn't the price difference Content vs Distribution?

    I'd assume that content would always surpass the value of distribution, but maybe that's what's changing.

    --
    "If A equals success, then the formua is A=X+Y+Z. X is work. Y is play. Z is keep your mouth shut" - A Einstein.
  5. Sheeeesh... it would take that much just to by HighOrbit · · Score: 4, Interesting

    ....pay for the bandwidth. How do they manage to pay for it now? I'd love to see some figures on their revenue vs costs.

  6. Re:1.5 huh by protohiro1 · · Score: 2, Interesting

    No kidding. What, exactly, does youtube have that can't be easily copied? The real winner in this online video thing is adobe and FLV.

    --
    Sig removed because it was obnoxious
  7. Dear Mr Murdoch song by drummer from Queen by Anonymous Coward · · Score: 2, Interesting


    Roger Taylor (The drummer from Queen) wrote an excellent song about Rupert Murdoch, to be found on his 'Happiness' album.
    Check out the Lyrics :-)

  8. Overpricing with no intent to sell by morcego · · Score: 2, Interesting

    Which can be really dangerous. It might just backfire.
    I had that experience myself, asking once for about 5 times the regular price on a service I really didn't want to execute. Guess what ? They said yes.

    Moral of the history: if you are going to overprice so you get a "no", make sure your price is so high there is absolutely no chance they will say yes.

    I should have asked 20x, not 5x. YouTube should be asking for $100bi is that is what they want (not to sell).

    --
    morcego
  9. Pretty rich valuation by Webomatica · · Score: 2, Interesting

    There are a lot of eyes looking at YouTube... supposedly 100 million videos watched a day. Even so I have my doubts as I feel the people that watch YouTube just want to watch videos and have no loyalty specific to YouTube. Admittedly they made web videos easy (no plug ins for QuickTime, Real, or MSN) and got people to embed videos on other sites. However I get the feeling that if YouTube craters due to copyright suits, or the company that buys them sticks ads all over everything, people will just start watching videos on some other site. So YouTube may be a good buy at first but then the parent company will inheret all their copyright problems and bandwidth expenses... so I feel the price is really high. I will predict it will be sold but for a much lower price. That said, if someone does buy YouTube for anywhere near $1.5 billion this will light a fire under Web 2.0 like Netscape's IPO in the ninetees. Welcome back the sock puppet and the chimps.

    --

    --------

    Webomatica

  10. Re:1.5 huh by Anonymous Coward · · Score: 1, Interesting

    Popularity can be bought. Pay some of the artists/offer prizes for clips that have highest # of views and suddently you have youtube 2.0.

  11. The time is right to sell it by melted · · Score: 2, Interesting

    It's about to go down in price. Google Video is about to release a new, less ugly version and then there's http://soapbox.msn.com/ and Live Video Search.