The Internet search engine Google has announced it is to buy the video-sharing website You Tube in a deal worth more than 1.3 billion euros in stock. The buy-out is the first to value one of the new crop of user-participation sites at over the one billion mark. The two companies will continue to operate separately. They have a natural synergy, says analyst Jay Laszlo: “This is still a market that is very young and there is not much that holds a user to one site. So I think they face the same challenges of continuing to make the audience grow larger but also very importantly holding onto the audience they’ve already got as more and more sites are vying for their attention and viewership.”
The acquisition should thrust Google into the emerging market of video advertising. YouTube has spearheaded the video-sharing craze, with an estimated 100 million clips viewed every day and 20 million visitors a month.