Google paid YouTube a premium for pirated content?

Article on Ars Tech - NBC's legal council Rick Cotton saying that most of the value of YouTube was from pirated content:

In this view, YouTube was a nice place for emo kids to post rants about Britney Spears, but this sort of stuff hardly made YouTube an essential visit. No, what built YouTube's brand was the flood of unauthorized commercial content sloshing around on the site a few years back—a heady time before Hulu et al. when one could reliably dig up episodes of The Simpsons, The Daily Show, or Saturday Night Live.

At a conference on the Future of Television this last week in New York, Cotton made it clear that he hasn't forgotten those early days. According to him, YouTube was vaulted into national popularity by SNL's hit "Lazy Sunday" rap about a pair of lame white guys from the Village who wanted nothing more than to spend a Sunday afternoon in the theater, watching The Chronicles of Narnia.

Now that was fairly clear at the time (our view here), which was why the amount Google paid ($1.65 bn) had many people gasping / shaking heads / raising eyebrows etc (was Google turning into dumb money etc) as it was clear it wasn't a sustainable play. What was more interesting is AOL repeating the trick a year or so later and buying Bebo for $830m - prompting Billy Bragg's calling the tune and Nick Carr's post about Digital Sharecropping.

Ars Tech reports a YouTube person later naysaying this, and noting that the shows mentioned above were just a blip. But there were many such blips - and the lesson is to watch what they do, not what they say - and what they are doing is finding more ways to load up on quality content with Ads and without lawsuits. YouTube is becoming just a New Order TV channel.