Google Kills the Video Star

By Rick Aristotle Munarriz
November 12, 2008 | Comments (2)

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Google (Nasdaq: GOOG) already owns the world's top video-sharing site in YouTube. Now it's ready for its voice chat close-up.

The online giant is adding voice and video chat to its Gmail interface this week. The move allows account holders to communicate, for free, with fellow members.

Beefing up a text chat platform isn't new. eBay's (Nasdaq: EBAY) Skype is the top dog here, but Yahoo! (Nasdaq: YHOO) Messenger and Microsoft's (Nasdaq: MSFT) Windows Live Messenger have been doing it for ages.

This doesn't make Google's entry any less noteworthy. The timing is perfect -- the lousy economy finds folks craving free voice and video communication. The technology is also in place, with even many dirt cheap netbooks coming with integrated webcams these days.

Despite the proliferation of personal computers and laptops with integrated cameras, Google's arrival will probably be good for leading webcam makers like Logitech (Nasdaq: LOGI) and Microsoft. Sure, this move diminishes Logitech's move to acquire video chat upstart SightSpeed last month, but all is good if it results in more people gifting Logitech webcams to long-distance friends and family members this holiday season.

The only real mystery at this point is how far Google will be willing to take this. Will it follow Skype in going beyond PC-to-PC usage and begin offering discounted connectivity to landlines and cell phones, further muddying the value proposition of more complete Web-based telcos like Vonage (NYSE: VG)? Is this the app that bridges its YouTube and GrandCentral purchases? Will I have to make sure that I'm decent the next time I check my Gmail?

When moving pictures and the big picture converge, isn't this ultimately about one more step in Google's quest for global domination?

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Longtime Fool contributor Rick Munarriz isn't necessarily ready for his close-up. He does not own shares in any of the stocks in this story. He is also part of the Rule Breakers newsletter research team, seeking out tomorrow's ultimate growth stocks a day early. The Fool has a disclosure policy.

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  • Report this Comment On November 12, 2008, at 3:25 PM, BuhByeeBay wrote:

    This is a thorn in eBay's backside that came at a most unfortunate time, and it's FREE! A word lost in the annals of eBay history long ago. Maybe they should of dumped Skype when they had the chance. Now their biggest blunder is worth even less.

    Something tells me, eBay should of let Google offer it's Google Check-out on their site instead of alienating them like they did the sellers.

    Good job Google! I will be happy to use your free video chat!

  • Report this Comment On November 15, 2008, at 5:24 PM, ocdgirl2000 wrote:

    All of those video chat programs are "knock-offs" of Paltalk. Paltalk is lightyears ahead of all of them.They've been around in the video chat voice chat business for years before anyone else was even doing it.Fortunately for them they have remained privately owned!

    If ebay was smart, they would be advertising and participating on Paltalk's business programs and radio shows. But nooooo,,,, the CEO's and the Board of Directors of the ebay company are too busy shopping at the mall to know what's going on in the world.

    They need to throw out John Donahoe. He's like the kiss of death for that company.

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