If its Google we're talking about even if the youtube portion of the company is losing money, does it matter? I think its pretty safe to assume that youtube will survive.

I mean, I'd assume that the idea of a loss leader somewhat applies here as well. Youtube is the leading brand for video on the internet, and that's worth something to the bigger Google brand.

Don't get me wrong, I think the debate about "free" is a debate worth having, I just don't like the misleading/sensational headline.