WHY GOOGLE BOUGHT YOUTUBE

Paul Carpenter 17th October 2006
Paul Carpenter

OK, so perhaps Google splashing $1.65 billion on buying another website doesn't affect you that much. After all - it's not your money! But understanding the reasoning behind the deal can give you an interesting insight into the future as Google sees it. And if your business is online - that is crucial information.

If you are not up to speed with YouTube, it is a site where anyone can upload video clips, and anyone can view those video clips. Amongst the millions of inevitable home movies, there are art-house films, shocking news footage and hours of copyrighted clips from TV shows.

OK. So Why Do Google Care?

Google's avowed mission is to "organise the world's information." Video content is (if you squint) 'information' of a kind. Google obviously sees mileage in this - it has had it's own video offering for some time. But behind the marketing fluff about Google's mission, it's worth remembering that Google's real mission is the same as yours: make money

And how will they make money?

When a service like YouTube is free and compelling, it attracts millions upon millions of dedicated users. All of those eyeballs are chances to sell advertising to companies like yours.

This might mean simply placing AdWords on YouTube. Where the real money might come into play is offering an easy way for TV networks to reach an online audience. Google is already experimenting with radio advertising and it's knowledge of demographics and content targeting means that any TV offering would be leapt at by TV advertisers who desperately want to target more accurately. As broadband takes hold, its not hard to see advertisers and TV producers queuing up to pay for a superb online video delivery system with targeted advertising.

And this might help too...

So how can you use this information?

Unless you are planning mass media buying with a strategic eye for the next 2-5 years, not much. What you can take though, is insight into what Google does. It is seeking alternative ways to bring content to the people. Any successful web company should be doing the same. Look around at what big companies like Google are doing and learn the lessons. Find new audiences for your content and your product, and you'll see sales and traffic soar.

Today's moral?

Even if you don't have $1.65 billion dollars to spend on buying another company, think about why you need to seek new ways to reach your customers.

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