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Wed, Oct 11, 2006 - Page 10 News List

Google bets US$1.65bn to acquire popular YouTube


While Google has been hauling away huge profits from the booming search market, it hasn't been able to become a major player in online video.

That should change now, pre-dicted Forrester Research analyst Charlene Li.

"This gives Google the video play they have been looking for and gives them a great opportunity to redefine how advertising is done," she said.

Investors applauded the possible acquisition as Google shares rose US$8.50 to close at US$429 on the NASDAQ, then added another US$3.11 in extended trading.

Several other suitors, including Microsoft Corp, Yahoo Inc and News Corp, reportedly have discussed a possible YouTube purchase in recent weeks.

Google's YouTube coup may intensify the pressure on Yahoo to make its own splash by buying Facebook.com, the second most popular social-networking site on the Internet. Yahoo has reportedly offered as much as US$1 billion for Palo Alto-based Facebook during months of sporadic talks.

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