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Google sets aside $187.5 million to indemnify YouTube

 8:54 pm on Nov 14, 2006 (gmt 0)

SAN FRANCISCO (MarketWatch) -- Google Inc. has set aside about $187.5 million of the approximately $1.65 billion it's paying for video-sharing site YouTube Inc. for unspecified current or future losses, it said Tuesday.

The language in a Google statement, which also discloses the deal has been closed, only describes the funds as being earmarked for "certain indemnification obligations."

While the language is very general, it does hint broadly that the money to be held in escrow for the next 12 months is meant to cover expenses related to copyright-infringement lawsuits, or content licensing fees YouTube already has agreed to pay, or may be forced to pay, in the future.

YouTube has angered many in the entertainment industry for letting users freely upload material without the appropriate OKs. In many ways, the extensive amount of pirated material available on the site is both YouTube's biggest problem and its biggest draw.

MarketWatch article [marketwatch.com]



 7:54 am on Nov 15, 2006 (gmt 0)

This is logical, but odd because I was under the impression Google was saying they were not doing this based on Battelle interviews with Eric Schmidt.


 9:47 am on Nov 15, 2006 (gmt 0)

If that's correct then its very nice and open of Google to inform those thinking about suing YouTube how much is there for the taking ;)


 2:35 pm on Nov 15, 2006 (gmt 0)

Travelsite, that's exactly what I was thinking ... trial lawyers will jump all over this one ... can't wait to see the first adwords ads soliciting "victims" of youtube... ;)


 5:33 pm on Nov 15, 2006 (gmt 0)

Has anyone been talking about Mark Cuban's post about the deal? This seems right in line with what he was talking about.


 5:42 pm on Nov 15, 2006 (gmt 0)

Sad that the anonymous post on Mark Cubans blog was first to out this situation, then Google denies it and now they're public with it.

"The former is not true," Schmidt said in response to the question of whether a "very large sum of money was set aside to buy peace" between YouTube and big media companies.
- Nov 9th


 10:07 pm on Nov 15, 2006 (gmt 0)

iblaine, yes Google was blatently lying to us. I read that article too about how 'There is no money earmarked for legal battles' and now they are saying there is? WHY?

Why tell everyone that you've got a pile of money for potential lawsuits and content sydication deals? Sounds like your asking for every sleeze to come out of the woodwork and go after Google's money.

There must be something I'm missing here. Can someone smart tell me why Goog would set themself up like this?


 10:17 pm on Nov 15, 2006 (gmt 0)

Cuban's post explains all.


 11:18 pm on Nov 15, 2006 (gmt 0)

>Can someone smart tell me why Goog would set themself up like this?

read mark cuban's blog...it's conjecture but provides a logical explaination about the deal.

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