1 A dot-com can become a media

1 A dot-com can become a media mogul

For two guys who just made hundreds of millions of dollars, YouTube founders Chad Hurley and Steve Chen were understandably giddy in the video announcement they posted the day after Google agreed to buy their barely 18-month-old company in October. “We now have the resources to take our service to the next level,” said Chen at the time. The $1.65 billion acquisition is destined to go down as either a prescient move by the Internet giant that cements its transition from the King of Search into the King of All Media or Exhibit A of the dot-com bubble redux—which this time around would take the form of Google’s inflated stock price and ego. Despite its dominance in search advertising, Google is far from infallible. It is a second-tier player in display ads and video placements. The company’s challenge: move its laser-targeted search system to the 95 percent of Web pages online that aren’t search results—and beyond that into other forms of media. With YouTube, Google has a laboratory for exploring new forms of targeted user-initiated advertising. If it can crack the code at YouTube, could TV be far behind?