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Watchers Await Google, Yahoo Deals

By: David Utter

Billion dollar acquisitions rumored to be percolating at Yahoo and Google have not yet delivered on their promised fruition.

Yahoo, Answers, And A Billion For FacebookThe chatter rose from blogs all the way up the media food pyramid, with major entities like the Wall Street Journal and the New York Times both picking up on the possibilities suggested for social networking site Facebook and video sharing site YouTube. With each, a billion or so dollars has been discussed as the magic number that will bring those sites into the folds of a couple of high-powered Internet players.

The draw of Google (GOOG) is so strong, the Journal routinely makes articles about it openly available on its public site, rather than trapped behind its subscription wall. Numerous stories about Google potentially absorbing YouTube for $1.6 billion have enthralled plenty of online commentators.

HDNet and Dallas Mavericks owner Mark Cuban has joined the online crescendo. He has been a frequent critic of YouTube as a copyright infringer, a charge that has been mitigated with YouTube's disclosure of distribution deals with Universal Music, Sony BMG Music, and CBS.

"Would Google be crazy to buy Youtube. No doubt about it. Moronic would be an understatement of a lifetime," Cuban said on his blog. He thinks Google should go with a partnership deal similar to the one Google landed with News Corp (NWS.A) for MySpace, which cost Google $900 million but promises a substantial return.

The talk about Yahoo (YHOO) and Facebook has quieted down in recent days. It is rumored Yahoo has a $1 billion carrot dangling in front of Facebook founder Mark Zuckerberg for the site.

Facebook's core membership of 9 million college and high school students has expanded as the site opened its doors to anyone who wanted to join.

Yahoo had the opportunity to spend a billion dollars last year on a site with far more members than Facebook. That would be AOL, which managed to evoke a bidding war between Google and Microsoft to provide search and advertising services to the site.

Instead of buying Facebook, Yahoo seems to have the services and the talent to duplicate that service. Perhaps Zuckerberg's technology is so compelling that Yahoo can see a way of plugging its entire social media and networking smorgasbord into it quickly, along with Yahoo's vaunted brand advertising products.

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