Putting all the speculations to rest, Google Inc. earlier this week officially announced a deal with YouTube – It confirmed to buy YouTube for US $1.65 in a stock-for-stock transaction.

YouTube is an extremely popular video sharing website that lets people upload, share and view the video clips. The website contains a variety of video content such as movie and TV clips, music videos and some amateur content as well.

The deal leads to an obvious curiosity – what made a search engine company to buy a video sharing website? The answer is simple; YouTube has a large pool of young audience. Through the deal Google is trying to acquire a young audience which may prove to be highly valuable in the advertising marketplace. Most of YouTube users are 15 to 24 years old which is a very attractive group of users in terms of advertising.

YouTube is currently one of the fastest growing website and was ranked as 15th most popular site and even outpaced its closest rival MySpace in video sharing category. (Source: http://www.hitwise.com/press-center/hitwiseHS2004/videosearch.php).

The popularity of YouTube is also evident by the fact that most of the bloggers today want to include a video link from YouTube site on their blog to in order to popularize their blog among the young users.

Though Google is a pretty balanced site with a vast audience of all age groups, its quest to woo young audience outlines the importance of catching generation ‘Y’ for the future perspective.