Assertion Partly supported AI assessment confidence: 95% certainty 5/5 debate potential 2/5

YouTube faced a $1 billion copyright lawsuit when Google acquired it

Dave Sobota · 20VC: So You Want To Be Acquired? Instacart VP of Corp Dev, Dave Sobota on His Biggest Lessons From 10 Years in Google's M&A Team Working on The Acquisitions of Motorola, Waze & Android · Apr 15, 2019 · at 9:44

Dave Sobota, former Google M&A lead, explains why YouTube selling to Google for $1.6 billion was a rational decision despite its later $100B+ valuation.

0:00 / 0:09exact quote · 9.2s

720p mp4 · rendered on demand · StarZero watermark

“YouTube was facing a billion dollar copyright lawsuit. I mean, it had growing infrastructure costs, and it had very little revenue, all three of which Google was able to help out with quite a bit.”

quote is from the automated transcript, cleaned for reading: filler sounds and stutters are removed, nothing is rephrased. names can be misheard (the analysis reads context, assessments check outside sources). how →

The claim, plainly

When Google acquired YouTube, YouTube was facing a $1 billion copyright lawsuit, escalating infrastructure costs, and generating very little revenue.

a quote alone can be ambiguous, so this restates it with the references and context of the conversation around it resolved. AI-written; the tape below the player is the source.

Assessment

The claim is partially true. At the time of Google's acquisition in late 2006, YouTube indeed suffered from escalating infrastructure costs (spending approximately $1 million per month on bandwidth) and generated minimal revenue. However, the claim that YouTube was facing a $1 billion copyright lawsuit at the time of acquisition is historically inaccurate. The famous $1 billion lawsuit (Viacom International, Inc. v. YouTube, Inc.) was not filed until March 13, 2007, four months after the transaction closed in November 2006. While YouTube was facing legal threats and smaller copyright lawsuits prior to the deal, the $1 billion suit did not exist at the time of acquisition.

Viacom filed its $1 billion copyright lawsuit against YouTube on March 13, 2007, several months after Google completed its acquisition of YouTube in November 2006.
Contemporaneous 2006 reports confirmed YouTube's bandwidth costs were approaching $1 million per month.
Financial analysts characterized YouTube at the time of acquisition as an unprofitable startup generating negligible revenue.

Checked against

[1] eff.org [2] wikipedia.org [3] benzinga.com [4] wikipedia.org [5] mttlr.org [6] cnet.com [7] theguardian.com [8] businessinsider.com

assessed as of 2026-07-23

This assessment is an AI reading of a public statement, made against the cited references with the confidence shown. It can be wrong. The quote, the tape and the references are all on this page; if something is off, use report an error below. full disclaimer →

Mentioned

Google YouTube

⚑ Spot an error? Report it

More from Dave Sobota

Assertion Supported

Private equity acquisition multiples are at all-time highs

“The multiples that PEs are paying are around all-time highs.”

Dave Sobota Apr 15, 2019 ▶ 7:08 20VC: So You Want To Be Acquired? Instacart VP of Corp Dev, Dave Sobota on His Biggest Lessons From 10 Years in Google's M&A Team Working on The Acquisitions of Motorola, Waze & Android

Insight

Successful M&A deals never look expensive in hindsight

“I completely agree with Peter. If you do a good M&A deal, no one's ever looked back and said, how much do we pay? It's just smiles and congratulations.”

Dave Sobota Apr 15, 2019 ▶ 7:32 20VC: So You Want To Be Acquired? Instacart VP of Corp Dev, Dave Sobota on His Biggest Lessons From 10 Years in Google's M&A Team Working on The Acquisitions of Motorola, Waze & Android

Assertion Supported

Google paid $1.1 billion for pre-revenue Waze and succeeded

“For example, if you look at a ways where we spent 1.1 billion dollars to buy them, that's been a tremendously successful deal for us. But at the time they had almost no revenue.”

Dave Sobota Apr 15, 2019 ▶ 7:52 20VC: So You Want To Be Acquired? Instacart VP of Corp Dev, Dave Sobota on His Biggest Lessons From 10 Years in Google's M&A Team Working on The Acquisitions of Motorola, Waze & Android

Insight

Founders should sell if acquirers pay expected future value today

“The general rule of thumb is that if someone is going to pay you today what you think you're reasonably going to be worth well into the future, then sell now.”

Dave Sobota Apr 15, 2019 ▶ 8:47 20VC: So You Want To Be Acquired? Instacart VP of Corp Dev, Dave Sobota on His Biggest Lessons From 10 Years in Google's M&A Team Working on The Acquisitions of Motorola, Waze & Android

Insight

Active internal sponsors are crucial for post-merger integration success

“The single most important element we found for a successful integration is that we have an engaged deal sponsor from the Google side stay intimately involved with the company after closing until it's fully integrated.”

Dave Sobota Apr 15, 2019 ▶ 20:16 20VC: So You Want To Be Acquired? Instacart VP of Corp Dev, Dave Sobota on His Biggest Lessons From 10 Years in Google's M&A Team Working on The Acquisitions of Motorola, Waze & Android

Assertion Supported

Waze signed an LOI with another acquirer before Google bought them

“Waze had actually signed a letter of intent with another acquirer when we got involved. One of our main competitors was a Waze stockholder and wasn't too keen on us buying them.”

Dave Sobota Apr 15, 2019 ▶ 22:24 20VC: So You Want To Be Acquired? Instacart VP of Corp Dev, Dave Sobota on His Biggest Lessons From 10 Years in Google's M&A Team Working on The Acquisitions of Motorola, Waze & Android

YouTube faced a $1 billion copyright lawsuit when Google acquired it

More from Dave Sobota

Turn any episode into a week of clips.