David Emery Online

Importance

10 October 2006

Yesterday, amongst all the millions of things that happened two things which you’ve no doubt all ready heard about occurred: Firstly, Google bought YouTube for $1.65 billion in stock. Almost simultaneously, North Korea conducted their first nuclear weapons test.

Which one of these was more important?

Which one of these is going to have more of an effect on the world?

I think it’s the Google-YouTube deal.

Put down that rotten tomato; let me explain!

Obviously, the possibility of North Korea becoming a nuclear power has a huge knock-on effect to the rest of the world; as we’ve seen with the current mess in Afghanistan and Iraq it really doesn’t take much of a reason for one country to invade the other. A nuclear arsenal is a pretty big reason.

We’re not, surprisingly enough, talking about America invading North Korea – Iran is next on their list”. We’re talking about China, which is possibly even worse. I see this playing out like this (baring in mind I-am-not-a-military-tactician): North Korea keeps on with the nuclear testing, as military might is the only things the North Koreans have left – from what I can tell they’re not much better of then Iraq was before the war (not as bad as how it is now, then…).

While this is going on the UN tries to impose all sorts of sanctions – which don’t have any effect – and probably tries to send in weapons inspectors (which have a proven track record of success. Oh, wait…). In response to ignoring the UN, China goes all USA and invades. They don’t need to worry too much about a nuclear exchange as while North Korea may be testing them, they certainly won’t have them deployable (yet). This is probably a good thing for everyone else but could have some knock-on effects with a neighbouring country.

Who?

Japan.

Having recovered from their post-war depression in style Japan has finally got back to a secure place as a major world power. However, it’s not currently in a good position economically, and there’s nothing better to keep a depressed populous in check then a good war. The situation between North Korea, China and Japan is a complicated one (I’ve glossed over quite a bit), and I don’t see that it’s going to end well for any of them.

And that’s the point.

North Korea testing a nuclear weapon yesterday makes little or no difference in the long run; their is going to be conflict in that region – it’s only a matter of time. This event may have sped it up a little, but the end game is still the same.

The YouTube / Google announcement, however really changes things. This is a hugely cleaver move on Google’s part; in fact, what we may have seen yesterday was the deal that saves Google.

For a start; $1.65 billion in shares is nothing – to Google at least. Google’s stock has gone up by $4billion in the last week so the price, while sounding high for a year-and-a-bit old company really isn’t that much of a hit to Google. Secondly, don’t forget what Google’s core business is; the only real revenue stream:

Adverts.

YouTube gets about 100 million pages views per day, and it’s only going up. That’s a huge platform for adverts, and Google are bound to be the first people to get online video adverts right – they certainly have the know-how. And don’t forget, we’re talking about the future of TV here. It’s obvious (I think) that the future of TV solely lies in online distribution, and I’m also pretty sure that advertising-funded is the way it’s going to go (sorry Apple!).

Picture a YouTube of the future, where you can browse the videos via your TV, find the latest episode of Lost in your “watch list” and play it then and there. Sure, it has adverts in, but you can watch it whenever you like and download it to your YouTube compatible video iPod (Apple and Google have been reputedly talking). And of course, those adverts are Google adverts.

What happens when Google controls TV? Will it be worse then the current networks?

It’s going to be interesting to find out.