AOL has revealed that it wanted to buy YouTube, but couldn't match Google's $1.6bn (about £840m) valuation of the video-sharing phenomenon.

"Anybody [in the internet space] who wasn't interested in YouTube was either asleep or not being honest," said Jonathan Miller, chief executive and chairman of AOL, at the Web 2.0 Summit in San Francisco.

Despite being unable to bag YouTube, AOL claims it's making good headway in its transition from a paid-subscriber model to an advertising-supported model, according to Miller. He said AOL's advertising revenue growth has exceeded the industry's growth in recent quarters.

Miller declined to comment when asked if parent company Time Warner would consider selling or spinning off AOL, now that AOL's reinvention is solidly in progress. The company recently sold its UK ISP to Carphone Warehouse, and in October Miller was quoted in a newspaper as saying that Time Warner is willing to engage in a discussion about a possible sale or spinoff for AOL. Without repeating the remarks attributed to him, Miller told Web 2.0 attendees he was misquoted.