$1.65B for YouTube is cheap

By now, everyone knows that Google bought YouTube for $1.65 billion. On the one hand, that’s a holy-mother amount of money. On the other, it’s cheap.

After all, Google just handed MySpace $900 million for adspace – and they didn’t even get any ownership! If Google’s buying the space for almost $1 billion, they’re probably hoping to make at least $2 billion.

Well, in buying YouTube they just cut out the middleman … and should make up the premium they paid in a few years at most. Besides which, YouTube offers far more interesting advertising opportunities … interstitials, before-the-vid-plays, product placement ads digitally inserted after the video was uploaded … you name it.

$1.65 billion? Cheap!

More on the story: Read/Write Web, GigaOM, Paul Kedrosky.

[tags] google, youtube, ads, adwords, adsense, video ads [/tags]