How much of that is due to Google helping them out though? Could Google have launched a competitor for say, $0.5BN? So long another big player didn't buy them up and do well, we could easily be laughing how they wanted 1.6 and Google only needed a third of that to win.
But I suppose it doesn't matter in the big scheme of things. Why take the risk of someone buying YT and maybe getting more traction? A billion dollars doesn't matter enough, long term.
Or look at Groupon, which hasn't really done better than Google's $6BN offer - that didn't work out spectacularly for Groupon. Imagine if Google used a few billion to get people using its deals site. They could spend millions a day subsidizing deals for a year or two just to build traction. Yet they still offered 6BN.
Google did have a competitor called Google Video which was failing horrendously.
One of the huge downsides of Google Video from a consumer side was that videos took 3 - 5 days to upload as they were proactively being checked for copyright infringement. Google probably never could have gotten away with the laissez faire attitude towards copyright infringement that a young startup like Youtube which is why it made sense for them to buy it, regardless of the price.
But I suppose it doesn't matter in the big scheme of things. Why take the risk of someone buying YT and maybe getting more traction? A billion dollars doesn't matter enough, long term.
Or look at Groupon, which hasn't really done better than Google's $6BN offer - that didn't work out spectacularly for Groupon. Imagine if Google used a few billion to get people using its deals site. They could spend millions a day subsidizing deals for a year or two just to build traction. Yet they still offered 6BN.