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Google, YouTube fear factor

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Hard to imagine that a 2-year old company started from scratch could be worth $1.65 billion, but that’s what YouTube is worth to Google. I had never visited YouTube’s site until about a month ago and that was just to see how it compares with Google video. I like Google video because of the simple interface, but it hasn’t been without technical glitches such as congestion and outages. I’m not sure how YouTube’s reliability has been, but I suppose that’s immaterial at this point. It will be one of Google’s products anyways.

This deal has certainly kept the analysts and pundits buzzing. USA Today had a couple of articles about the changing landscape of the online industry. One interesting observation was how fast some of the new startups reach lofty levels these days. I agree, but only cautiously. Sure we’ve had MySpace, YouTube, and now there’s talk of Yahoo going or FaceBook, but I view these as anomalies; jackpots for the lucky few who saw traffic rise to unimaginable levels on their sites.

At this point the Web titans are nervous about being upstaged by younger rivals encroaching on their secondary territories. Google is probably not too worried about a newcomer offering fancy Web searches, but a video site is a different matter. There’s also the fear of rivals snapping up the promising companies, and the helps to feed the buy-up frenzy,

Okay we knew all that, but one wonders if YouTube will ever earn its keep. Did Google give its own video service enough time to blossom, or have their abandoned their patient ways that got them to where they are now? Google wasn’t always the most popular destination for Web search. But having a good product with enough differentiation, a constant drive for perfection, and patience paid off in the long run. Maybe Google could have applied some of the same principles to Google video without having to spend the big chunk on YouTube. But I suppose once you get that big, the fear of losing the number one spot forces you into making frenzied, and sometimes not too wise, decisions.

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