Google buys YouTube for $1.65 billion

Let the games begin. Google made it official this afternoon, agreeing to acquire the video-sharing site for $1.65 billion. The betting on video-sharing is huge, especially given that the site includes clips from television shows and movies that get posted without permission from the content originator. That's a violation of copyright law - and YouTube now has some pretty deep pockets for plaintiffs to peruse. Mark Cuban called the deal "moronic."

"Dont think for a minute that there wont be lawyers writing songs, having their buddies perform them, and putting them on YouTube, jerry-rigging the number of views via any number of easy-to-do processes and then suing YouTube over it,� he wrote. Better for Google, he wrote, would be to strike an advertising deal similar to the one it has with MySpace.

The deal also makes you wonder how the other mega-media players might respond. Rupert Murdoch has MySpace, but what about Viacom, Disney, Yahoo, Time Warner, etc.? You can be sure that the second-tier video sites have just jacked up their prices, but will they be worth it?