Google buys YouTube for $1.65 billion

Let the games begin. Google made it official this afternoon, agreeing to acquire the video-sharing site for $1.65 billion. The betting on video-sharing is huge, especially given that the site includes clips from television shows and movies that get posted without permission from the content originator. That's a violation of copyright law - and YouTube now has some pretty deep pockets for plaintiffs to peruse. Mark Cuban called the deal "moronic."

"Dont think for a minute that there wont be lawyers writing songs, having their buddies perform them, and putting them on YouTube, jerry-rigging the number of views via any number of easy-to-do processes and then suing YouTube over it,” he wrote. Better for Google, he wrote, would be to strike an advertising deal similar to the one it has with MySpace.

The deal also makes you wonder how the other mega-media players might respond. Rupert Murdoch has MySpace, but what about Viacom, Disney, Yahoo, Time Warner, etc.? You can be sure that the second-tier video sites have just jacked up their prices, but will they be worth it?