Mike Arrington of TechCrunch is reporting that a rumour is circulating that Google may buy Youtube for around $1.6 billion.

“A quick phone call to a VC confirmed that the rumor is circulating (he also confirmed the price), but that is far from confirmation that this deal is happening. I’m digging for more but the source on this one is very good.”

His counter-intuitive point is that Google won’t be put off by the many irrate copyright holders whose rights have been breached by YouTube — they are now trying to strike deals with the owners.

Of course, Google would have to add the legal costs of these defences to the $1.6bn price of the property. Is that a good idea?

Arrington thinks it’s about 40pc likely. Time will tell.