Recently, I talked to the founder and CTO of Blinkx, Suranga Chandratillake. When he started his video search service a couple years ago, many people were skeptical.

Of course, that's no longer the case – especially in light of Google's $1.65 billion purchase of YouTube.

"But searching video is still a tough problem," said Chandratillake. And even the mighty Google Inc. (NASDAQ:GOOG) is coming up short.

The acquisition of YouTube should help with the effort. Google will also learn how to deal with complex content licensing issues, as well as scaling infrastructure for the heavy bandwidth requirements of online video. Oh, there is also the challenge of finding ways to monetize the stuff.

For the most part, video sites let their own users tag the content. While this generally works with sites like Flickr and other Web 2.0 properties, it is far from perfect. Actually, it is often the case that users enter little or no information about their videos. Rather, the users just want to quickly post the content.

Another big problem: some users will put misleading tags on videos. This is a way to help juice traffic. But, of course, it means the search results are essentially irrelevant.

As for Blinkx, it has developed a system that uses voice recognition to build search indexes for online video -- as well as facial recognition. And, it is working fairly well – as the company has been signing a variety of major deals, such as with Lycos and even Microsoft.

True, Google has thousands of smart programmers who can come up with video search technologies. But, as seen with its original video sharing service, the in-house-development approach has its limitations.

Besides, given the fact that video is critically important for Google's growth, it's a good bet the company is going to buy up more companies in the space. And its major competitors – like Yahoo Inc. (NASDAQ:YHOO) and Microsoft Corporation (NASDAQ:MSFT) – will also open their checkbooks. In fact, Google recently purchased a facial recognition company, Neven Vision.

In other words, there are a variety of upstart video search companies in play. Besides Blinkx, it would not be surprising to see others like Metacafe, PureVideo Networks, and PodZinger get scooped up.

Tom Taulli is the author of various books, including the Complete M&A Handbook and operates InvestorOffering.com.

Eight years ago, Condé Nast bought Wired Magazine (print) and Lycos bought Wired Digital. Now, Condé Nast is fulfilling a longtime goal of uniting the two publications with its purchase of Wired News from Lycos for $25 million. Lycos isn't selling Hotbot, Hotwired and Webmonkey, but today's deal includes all of Wired News assets -- website, news content and domain name.

About a year ago Wired News laid off all staff writers when it cut its work force by half. Since then Wired News has relied on freelance writers.

Condé Nast said it would retain Wired News staff according Daum Communications of Korea, Lycos' parent company. CondéNet, Condé Nast Publications' web division, will operate Wired News assets.