Google Closed YouTube Deal for $1.78 billion; Rivals Sense Opportunity

Today Google announced that they have completed the acquisition of YouTube. Based on today’s closing price of $481.03 per share, the deal is already worth $1.775 billion to YouTube’s shareholders.

But the combination of a YouTube copyright crackdown and increased competition could mean that YouTube may find it difficult to stay on top indefinitely, writes via CNN Money. Online video competitors are taking different approaches:

  • Metacafe (Oct. traffic 3.8 million users) is trying to differentiate itself from YouTube by offering creators of user-generated content the ability to get paid based on how many page views their videos generate.
  • Revver (Oct. traffic 262,000 visitors) inserts one-frame advertisements at the end of videos and shares the ad revenue with the creators.
  • VideoEgg is trying to be more of a partner with larger firms as opposed to a destination site for user videos. In addition to tools, VideoEgg has also developed an online video ad platform that's used by social networking sites such as Bebo, Dogster and Tagged.
Traffic to Online Video Sites
Total Unique Visitors (in millions)
Site Sept. 06 Oct. 06
YouTube 20.8 23.5
Yahoo Video 18.6 20.9
Google Video 13.2 14.6
MSN Video 17.1 13.9
MySpace Videos 8.9 10.0 6.9 7.8 4.3 4.2
Metacafe 4.2 3.8 3.5 2.8
Source: comScore Media Metrix

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