360 Degrees of Google

Editor's Note: In this edition of "360 Degrees," RealMoney commentators evaluate Google's (GOOG Quote) acquisition of YouTube. What does it mean for the company and the stock?

TheStreet.com has always believed that offering a wide variety of opinions and viewpoints -- rather than a monolithic "house view" -- helps readers make better-informed investment decisions. In that spirit, we bring you "360 Degrees."

"360 Degrees" is a feature that takes advantage of our varied stable of contributors to RealMoney, who offer analysis of stocks and the markets from all angles -- fundamental vs. technical, short-term trader vs. long-term investor.

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YouTube's No Dot-Com-Craze Dumper, by Jim Cramer

Originally published on RealMoney on Oct. 10 at 9:50 a.m. EDT

Shades of another era. Just like the dot-com craze. No different from the nuttiness of 1999-2000.

I wish I could agree. I wish I could write off this YouTube as a one-off situation. But I can't. I can't because the big difference between this time around and last time is one simple word: Profits.

All the dot-com outfits people brought public and combined with in the 1998-2000 period shared one thing: Giant losses. They gave away stock because the stock was overvalued, given the short-term performance of the entities that paid for these properties.

Google, on the other hand, is immensely profitable. It is beyond-belief profitable vs. the entire dot-com world. I remember when Henry Blodget, late of the Internet analyst community, said that there would be only a few winners in the dot-com world, so you needed to buy a basket of properties; that way, if you hit one or two of them, it all worked.

I wish that were the case. The big moves in Yahoo!(YHOO Quote) and eBay(EBAY Quote) and Amazon(AMZN Quote) ended so long ago, it's hard to remember them as growth entities. IAC/InterActiveCorp(IACI Quote) is coming back ever so slowly. None of those companies has spectacular growth anymore in revenue or profit.

Meanwhile, old media totally muffed it, thinking only about how to pimp the stock market in equity offerings, ones that didn't get done. And nobody else stepped up to the plate.

Except for Google. It would have been "more right" if Blodget had said there would be only one winner, but that seemed absurd at the time. I now regard it as true. Which is why it can buy YouTube for so much "money," or wampum as I am sure you will hear, and nobody sells the stock down.

To me, it is obvious that YouTube easily could be monetized in the Google system, something that no other entity, save Yahoo!, could possibly say. Microsoft(MSFT Quote) can't say it, because its online efforts still lack vigor. Time Warner's(TWX Quote) AOL? Have you gone to its site lately? It looks like it's stuck in 1999. IAC? That's a service site. News Corp.'s(NWS Quote) already got one and CBS(CBS Quote) is rightly focused on developing CSI's and more CSI's, which are incredibly profitable in their own right.