Google has indeed bought YouTube, beating the "$1.5 billion reserve price" with a $1.65 billion stock deal.

Jim Cramer (via Fred) says he was concerned with the $1.5 billion price - or rather, "concerned that someone else will come in and pay $2 billion." 

YouTube and Google could be game, set, match for the next generation of viewers. You know that Google basically buys a network with no production costs by buying YouTube. You hit up something you want to learn about on Google, and it could direct you to text and some funky or authoritative video made by a homegamer. Nothing could be as exciting as that. I believe that this combination is lethal for the networks.

Of course, Google already had Google Video, so one would argue that it could have done this already. Clearly, Google was buying YouTube's audience and/or employees, not the technology.

I guess time will tell, but this still seems like a curiously high price for a company that has a ton of operating costs and has not really figured out how to monetize its audience. I'm interested to hear Jason Calacanis' take.

Google also announced agreements with Warner Music and Sony BMG to stream their music videos in an ad-supported model. This isn't terribly surprising since YouTube already had a similar deal in place with Warner, and I'm sure these announcements were not entirely coincidental.

As a shareholder, I'm not sure how I feel about it - though I do hope Cramer is right about that $500 share price.

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