You may have noticed that I never wrote anything about Googleís recent acquisition of YouTube while the rest of the world seemed to be.
Thatís not entirely true. I wrote about it a bit on an internal mailing list at work. What I read there and all over the Internet shocked me. A significant proportion of people completely missed the point. They thought Google had gone off the deep end.
I was shocked. It was so pervasive that I figured I better keep quiet, since I was obviously missing something.
People wrote about how the site is ugly, the technology sucks, the potential legal problems, and so on. They made passionate arguments that sounded convincing if you didnít understand the business that Google is in.
My hatís off to Dave McClure, the Master of 500 Hats for finally saying it.
Itís not about community, design, technology, or copyright. Itís about eyeballs. Lots and lots of eyeballs. Itís 1999 all over again.
Google bought themselves a really, really big video advertising distribution network (or ďplatformĒ if you prefer).
Can someone please explain to me why this wasnít blindingly obvious to a lot more people? Iím at a loss here. I have been since the speculation of the deal first surfaced.
In trying to explain this to people, I pose a different question: What's the single biggest threat to Google's continued growth?
The variety of answers I get is interesting, but few people hit the one I have in mind: a lack of inventory. Their ability to find new places to stick ads is the single biggest threat to the continued growth for their business.
That's why they're doing deals with MySpace, Dell, and all sorts of companies. It's all about the eyeballs, or inventory (as DanR recently said[*]).
I don't know about you, but as a Google shareholder, I'd be pretty upset if they weren't pursuing deals to expand their inventory. Of course, as a Yahoo! shareholder and employee, I hope they're not too successful. :-)
Posted by jzawodn at October 18, 2006 10:21 PM