The acquisition of Photobucket by MySpace challenged Google-YouTube

Murdoch reluctantly watched Google include YouTube, but he will not lose hands with Photobucket.
According to a person familiar with the matter, MySpace has reached an agreement to buy the largest photo sharing service Photobucket. On Monday, a person familiar with the demand not to be named confirmed the deal on the Valleywag blog.
The people familiar with the matter said that the two sides still need to finalize some details before making a public announcement of the deal. Although the financial terms agreed by the two parties are unknown, Photobucket has been seeking to sell itself in recent months and asking for $0.3 billion is a "public secret" in the industry ".
Just a month ago, the two companies competed with each other in a PR campaign. MySpace accused Photobucket of violating the protocol by encouraging users to include advertisements in the slides published to MySpace. Photobucket said that without prior notice, mySpace blocks their photo slides and videos.
Just as the public relations battles between the two companies were raging, some insiders asserted that MySpace may soon acquire Photobucket on the grounds that by indicating that Photobucket is dependent on MySpace, mySpace wants to suppress the price of Photobucket.
There are many similarities between Photobucket and YouTube. In the past year, Photobucket's number of independent users per month has doubled to 18 million, making it among the Top 50 websites on the Web, about 45000 videos are added every day.
The attractiveness of Photobucket is similar to that of YouTube. Photobucket uses a technology that allows users to publish photos and videos on any Web site.
The growth rate of Photobucket is comparable to that of MySpace. Observers said this was not accidental. Like YouTube, the advent of Photobucket comes as MySpace users seek to "decorate" their archive pages with videos, photos, and music.
Among these companies, YouTube is the most successful. It is no secret that Murdoch is eager to get YouTube, but Google is taking it for love for $1.65 billion.
Forrester Research analyst James said that if he bought a Photobucket at a price of $0.3 billion, he would not have paid for it. He pointed out that even if the purchase of Photobucket is purely for traffic, MySpace's money is worth the money.
It is estimated that the proportion of users shared by the two companies is between 25% and 50%. Even if MySpace only receives 50% of Photobucket users, it also means it will get 9 million new users. If it is calculated at a price of $0.3 billion, the acquisition cost of each user is $35.
James said it was a reasonable price. MySpace can be easily sold through advertising, but this is not the reason for the purchase. Only by merging two services can we provide corresponding value to the market. Now the question is how MySpace uses Photobucket.