Cheaper bandwidth or bust: How Google saved YouTube
On October 9, 2006, Google bought the then year-and-a-half-old YouTube for a staggering $1.65 billion. It was Google’s biggest acquisition to date by $1.55 billion. Google bought a very popular site that was very expensive to run and lacked a business model. It was staring down potentially billions in lawsuits from music, movie, and TV companies—and Google did it anyway.
In hindsight, Google and YouTube were a match made in heaven. Google, which already ran Google Search, AdWords/AdSense, Gmail, Google Maps, Google News, and Blogger, brought tons of big-site know-how to YouTube. It had the infrastructure to not only keep the site growing, but Google could reduce its costs. – Ron Amadeo, Ars Technica