Many industry experts said that Google would never buy YouTube because of the sheer volume of copyright infringing videos on there, but as I pointed out on the weekend (and again on the John Stanley afternoon show on 2CC and 2UE today) Google are very well placed to handle these copyright concerns as they already have their own competing video service  and even a highly controversial book scanning program.
So, where to from here for Google Video and YouTube? I would expect a merger over the coming months, with Google hopefully implementing some of the good features of YouTube in the merged service, and not just moving all the videos over. There will be a no-signup period for a couple weeks when Google move YouTube over to Google Accounts, muchy like what happened when they bought Writely …and ultimately Google will ensure the success and profit of the merged video service by expanding their video sales syetem to all countries, not just the US.
I’m quite happy about this, because I no longer have to upload videos to both services on the fear that one will fold, and I can be almost 100% certain that these videos will be there forever more.
Update 10/October/2006 @ 6:46pm: Video message from YouTube’s former owners: