Great points. I bet you're right that the $106.5m number could be easily returned and more.
What I like about Google's approach, compared to Microsoft's or Apple's or Comcast's or [insert Fortune 500 company], is that their goal is to not make ALL the money nor control ALL the components between point A and point me.
Google has a different M.O. than the established technology players, and the others are finding Google difficult emulate/kill/marginalize/contain.
I reminds me of the "which would win in a fight, a Tiger or an Alligator" question, the answer to which depends on where they're fighting, land or water.
Google may not even be on the planet, never mind land or water, and may not even be aware of the rules of the fight.
They would scare me if it weren't for their consistent contributions to Open Source.
They paid for the patents, not the codecs, much less the terrible implementations.
Each generation of codec implementations uses a lot of the same techniques, most of which are patented by somebody. Google can take On2's patents and license them freely under the condition that licensees must not bring patent infringement suits against anyone else.
They could suck a lot of air out of the debate, on both the freetard and patent-troll sides.
From my reading On2 were one of the few people who avoided rather than licenced some very basic concepts from MPEG and they marketed this as one of their unique selling points.
This may partly explain lack of world beating performance compared with what is theoretically possible if you ignore patents, and also means that Google may have been paying for the opposite of patents, patent workarounds (whether On2 patented these in turn I don't know).
In fact, they may have already done more than any other company ever.
This acquisition, plus what's going on with pubsubhubbub over the past few weeks, will really go a long way to putting the network back in our hands.