The all-stock deal leaves a $10bn cash pile intact and lifts Google from seventh to market leader in online video distribution - usurping former No.1 MySpace. But the meteoric rise shows how Google Video struggled - and it is not alone.

Google Finance is only the 4,485th most popular website in the UK, according to Hitwise, the market analysts. Far more worrying, since search, e-mail and video are now regarded as the three must-have services to drive advertising revenues, Google Mail, at 43rd, has only around a twentieth of Microsoft's Hotmail traffic.

Google insiders say that the company's internal workings are sometimes confusing. Its plan to run YouTube independently alongside Google Video - a competitor - is either a masterstroke in understanding the fickleness of social network site users, or more evidence of Google’s haphazard execution.

As Goldman Sachs's highly paid analysts said today: "time will tell". But meanwhile, it also looks odd that MySpace, owned by Times Online’s parent company, signed a $900 million advertising deal with Google two months ago - only to find that overnight its partner has become its biggest competitor.

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