Google has agreed to buy YouTube, an online video company in the US for $1.6bn. The deal raises a number of interesting points. First, this was a company that has been in existence for about one year. To go from zero to $1.6BN in such a short time frame -- it shows how quickly value builds in the internet time zone. And what goes up so fast can come down so fast (or as News Corp has found out through its acquisition of My Space, can keep going up faster and faster!) . Traditional metrics--what did the Company do in EBITDA in the last twelve months is irrelevant in valuation- what was the traffic this month vs. last month is more appropos. Old players like Yahoo who put a stake in the ground on video long ago (like 2003 is long ago) have failed. Note that in video No. 1 is YouTube, No. 2 is MySpace and No.3 is Google.

Second, look how young the entrepreneurs are. All of the entrepreneurs of the new media powerhouses--My Space, Facebook and YouTube are in the 20s. Never has the "generation gap" been more prominent in business in such new industries. It is a perception gap--it is hard for the "aged" with settled views of the way the world works to understand this world, frankly. Stay light on your feet.

We will be learning more about this "New Media" and try to understand how it is disrupting the media industry.

Speaking of disruption, it has long been my claim that the "air" would go out of the mobile telephone business. Technology related industries are increasingly acting like the capital markets--finding ways to arbitrage price differences--and moving at the speed of light to rub out the difference. As an example, see two articles (one, two) from the IHT on such arbitrage plays.