With YouTube, can Google surpass Yahoo! as the #1 web destination?

Google's telegraphed buy of YouTube was finally announced yesterday afternoon. The search leader will pay some $1.65 Billion in GOOG shares to acquire the #1 video platform with over 100 million daily video viewings. Those CBS, Sony BMG, and Warner Music commitments will be worth a bit more now and should legitimize this business model.

More importantly, Google Inc. (NASDAQ: GOOG) may surpass Yahoo! Inc. (NASDAQ: YHOO) now as the number one combined destination on the web. Yahoo! and its properties still hold the pole position for overall web traffic on the web, with Google as number two, and MySpace coming in as number three. With the combined search from MySpace and with YouTube listed as number eight, Google might just take the lead. If not, it very well may eclipse it in the metric of stickiness and "time inside."

"The YouTube team has built an exciting and powerful media platform that complements Google's mission to organize the world's information and make it universally accessible and useful," said Eric Schmidt, Google's CEO.

Level 3 communications Inc. (NASDAQ: LVLT) is the newest YouTube bandwidth provider and it is trading up almost 1% this morning. Shares of Google are up 0.5% this morning, after closing up 2% at $429.00 yesterday.

Jon Ogg is a partner in 24/7 Wall St., LLC; he does not own securities in the companies he covers.