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Facebook Purchases 650 AOL Patents From Microsoft 93

Posted by Soulskill from the patent-rent-to-own dept.
eldavojohn writes "Not two weeks after Microsoft purchased 925 patents and patent applications plus licenses to AOL's portfolio for $1 billion, Facebook has now acquired 650 of said patents and patent applications for $550 million to which Microsoft retains a license. So, was Microsoft's $450 million worth it? According to their press release: 'Upon closing of this transaction with Facebook, Microsoft will retain ownership of approximately 275 AOL patents and applications; a license to the approximately 650 AOL patents and applications that will now be owned by Facebook; and a license to approximately 300 patents that AOL did not sell in its auction.' Will the patent-go-round continue, or has Facebook loaded up for a good old-fashion Mexican standoff?"
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Facebook Purchases 650 AOL Patents From Microsoft More

Facebook Purchases 650 AOL Patents From Microsoft

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  • W00t (Score:4, Insightful)

    by masternerdguy ( 2468142 ) on Monday April 23, 2012 @01:33PM (#39774169)
    Now facebook can monitor you even more effectively.

  • Further Alignment (Score:5, Interesting)

    by alphatel ( 1450715 ) * on Monday April 23, 2012 @01:42PM (#39774245)
    Google has already staked their company on G+. Does Microsoft gain an edge by helping Facebook even if there is no direct payoff?
    The enemy of my enemy is my friend.
    See where this is going?

    • Google has already staked their company on G+.

      What are you talking about?

      • Re:Further Alignment (Score:5, Interesting)

        by alphatel ( 1450715 ) * on Monday April 23, 2012 @02:02PM (#39774485)
        Is this your first visit to /. ?
        Page re-aligns Google [yahoo.com]
        "When he took over as CEO, Page quickly made his top priority clear by moving Google's executive offices into the same building as the team working on Google Plus. Page also tied a portion of employee bonuses to the success of Google Plus and eliminated what he considered to be unnecessary distractions by closing more than 20 of the company's less popular services.
        "Larry is driven by his paranoia about Facebook. Clearly, these are two companies at war with each other," said Ken Auletta, who got to know Page while writing his book about the company.

        • Re: (Score:2, Insightful)

          by Anonymous Coward

          Making a product a priority and betting the companies future on a product are not the same thing. I very much doubt they will get significant revenue from G+ anytime soon.

          • Re: (Score:2)

            by PCM2 ( 4486 )

            Making a product a priority and betting the companies future on a product are not the same thing. I very much doubt they will get significant revenue from G+ anytime soon.

            How could you tell how much revenue Google gets from it? Google's entire business is based on capturing eyeballs in order to offer greater value to advertisers. Do you honestly think G+ is not designed to do that? And yet, the revenue Google captures from these moves will be reported in the advertising portion of its business. You're not going to see any "Google+ revenue" figure on its 10-K.

        • Whooooooooosh!

        • "Re-aligning" and "staking your company on" are two different things.

          McDonalds aligns it's advertising to the McRib sandwich every time it comes out. They do not stake themselves on the McRib though. They spend a lot on advertising that one sandwich each time, but if they don't sell any, McDonalds is not going to declare bankruptcy.

          Google is putting a lot of effort into getting you to use google plus, and maybe all the top people over at google are trying to beat facebook at the social media game, t

    • Re: (Score:1)

      by Anonymous Coward

      I could care less about either company. I'm just hoping between this and the recent Apple patent trolling, more people will realize just how broken our patent system is.

      • This will have no impact whatever on the structure of the patent system. Perhaps one in one thousand of the general public could even explain what a patent is.

      • I could care less about either company.

        ARGH! Fighting... grammar... nazi... tendencies...

        • Re: (Score:3)

          by gnick ( 1211984 )

          ARGH! Fighting... grammar... nazi... tendencies...

          I think you meant to say, "I am fight grammar Nazi tendencies." But that's fine. For all intensive porpoises, their the same. Too different ways of getting your point acrossed. I could care less. =)

    • Only I will remain.

    • Re: (Score:2)

      by Nyall ( 646782 )

      No direct payoff? Microsoft put 240 million into facebook in 2007.

      They are merely protecting an investment.

      • Wait - Microsoft invested $240 million into facebook, and in return Microsoft... sold facebook $650 million worth of patents to 'protect an investment'?

        Who is investing in who?

        • Re: (Score:2)

          by zlives ( 2009072 )

          the pre-ipo circle jerk continues

          • Re: (Score:2)

            by rtb61 ( 674572 )

            Exactly right. Facebook paid M$ nothing for 650 patents. M$ who already owns a chunk of Facebook, helped to create the illusion of wealth by accepting $? worth of Facebook junk shares prior to IPO. Seems like M$ is going to bail on it's investment of Facebook not long after the IPO, it's working to fatten the calf for the slaughter that follows.

            These stories should make a clear distinction between paying for somehow with hard cash and making junk share payments prior to IPO. What is the SEC asleep at the

        • Re: (Score:2)

          by Nyall ( 646782 )

          First its $550 million. And yes it looks like microsoft has so far made a 550-240=310 million profit. But I can also see an advantage in facebook having their 900lb gorilla buddy microsoft being the one to go to AOL and negotiate for these patents. Namely if it was FB doing the negotiating that would have tipped their hand, then the patents might have been costlier.

          Also microsoft has a billion to throw around, while I'm not sure facebook has that pre-ipo.

    • Yes, in principle I agree with you, but there is a caveat: I suspect that Facebook cannot further crush G+, since they, in essence, aren't competing against each other anymore. What I mean is, those that prefer the G+ style of doing social networking, won't leave G+, and those who prefer Facebook haven't joined and never will (or maybe joined for a brief moment, looked around and left). G+ won't grow much, I think (I'm a G+ user, BTW), but it doesn't really have to. Don't get me wrong, I am sure Google woul

      • Re: (Score:2)

        by PCM2 ( 4486 )

        G+ won't grow much, I think (I'm a G+ user, BTW), but it doesn't really have to.

        I'm not a huge fan of G+, but I think you might be wrong. It's just that G+'s growth will probably come at Twitter's expense, rather than Facebook's. That's just my gut feeling, though.

        • It all depends on how you define "grow much" - I agree that there will be growth in numbers for G+, but not more than a couple million users from now till the end of this year, and steadily slower growth after that. That it will be on the expense of Twitter... well, it makes sense. Plus, I've met more than just a few such people who moved over from Twitter to G+, and almost nobody (very, very few) who moved over from FB.

    • Re: (Score:1)

      by Anonymous Coward

      I'd say yes, MS gains an edge, Google has staked too much on G+, so hitting them there hurts more than hitting them anywhere else. Given Google's anti-competitive games, and seeming immunity from anti-trust probes have made them a fair amount of enemies, taking them down a notch or three is a boon to pretty much everyone else in the industry, in every sector Google tries to invade.

      Who'd have thought, evil proprietary corporations cooperating for the greater good.

    • Re: (Score:2)

      by Yvan256 ( 722131 )

      See where this is going?

      If you keep clicking on links, sooner or later you'll end up on an adult website?

    • Microsoft has been "partnered" with Facebook for several years now [fastcompany.com]. Nothing new here. It's also probably why MS doesn't have its own social network and such, but adds Facebook integration to many of its products (Windows Phone has it out of the box, for example, and so does Xbox).

      • Microsoft DOES have its own social network, they have single sign on and they have forums and messenger. But nobody particularly wants to use it; normal people don't want to use it because it sucks and nerds don't want to use it because they have to trust Microsoft to run scripts on their computer to even log into anything Windows Live any more. That means I can't even look up most forum posts about Halo Reach. Consequently Microsoft has had to go afield to find social networking users.

        • Microsoft DOES have its own social network, they have single sign on and they have forums and messenger.

          That does not make for a social network.

          • That does not make for a social network.

            You can make people your friend and follow their output, just because it's a shitty social network doesn't mean it isn't a social network. They also have Xbox Live, although that is fairly specific. That's an even more limited social network because it only permits real-time socialization, but it still is one. (You can leave messages, too, but they're not public. You can, however, publish some content to the network publically.)

    • Google has already staked their company on G+. Does Microsoft gain an edge by helping Facebook even if there is no direct payoff?

      The enemy of my enemy is my friend.
        See where this is going?

      Alignment with the galactic center. Film on 12-21-2012.

    • Re: (Score:2)

      by Xest ( 935314 )

      Microsoft invested in Facebook very early on. Politically it's hard to see Facebook and Microsoft as a separate entity, they seem almost identically aligned in this respect, they've been scratching each others back for a long long time now to the point it's really impossible to consider whether an action by Facebook against a competitor of Facebook was really an independent action at all. Microsoft's opinion seems to hold a lot of sway at Facebook, and vice versa to a lesser extent. I'd argue the companies

  • Greater Fool Theory (Score:3)

    by McGruber ( 1417641 ) on Monday April 23, 2012 @01:47PM (#39774299)

    All this means is that Zuckerberg is a greater fool than Balmer. (http://en.wikipedia.org/wiki/Greater_fool_theory)

    That is to be expected, since youth and talent are no match for age and treachery.

    • youth and talent are no match for age and treachery.

      until Alzheimer's kicks in

    • All this means is that Zuckerberg is a greater fool than Balmer.

      I don't buy that for a second. Some college kid creates 2 billion dollars in his dorm room (never mind whatever swindling and conniving he did along the way for a secod), and buying some AOL patents suddenly makes him a fool? I don't think so. Something else is afoot.

      • Peter Principle. Zuckerberg hit his peak as a swindling conniver in college, it's all downhill from here.....

      • Re: (Score:1)

        by Anonymous Coward

        It's the Law of Unsuccessful Douchebags.

        People who aren't wildly successful often become hostile douchebags to anyone achieving success. Douchebaggery usually includes negative caveats (eg, the aforementioned, 'Baaaw, swindling!') or trendy hatred ("Facebook sucks because everyone on an Internet forum agrees with me!") without any actual knowledge surrounding the acquisition of the target's success.

        I've noticed it usually affects my fellow Americans more than other cultures; be that as it may, it's a trul

    • No, he demonstrated that a few weeks ago. $1B for Instagram?

  • Once FB goes public they will be lawfully required to turn a profit by any "lawful" means necessary, suing everyone over patent infringement is just another revenue stream, and makes them more "desirable". The problem with them holding all the cards is we don't know what those cards and if they are even worth anything.

    • I would suspect that that's one reason for the patent purchase, but I would also expect that the other is because Yahoo is already suing them for patent infringement.

      • Re: (Score:2)

        by Sir_Sri ( 199544 )

        It's probably a bit of both. Once they have to make (more) money they have to start doing things which make money beyond just showing some sketchy adds on the side of the page. That runs the risk of headbutting into patents that people do, or did use to make money (think amazons 1 click), and suddenly you're at risk for very expensive legal fights. The one click thing is a good example, because even though the patent is up in the air, and under discussion several places, if it is granted (in the EU for e

    • Re:Gearing up for IPO.. (Score:4, Interesting)

      by Pope ( 17780 ) on Monday April 23, 2012 @03:14PM (#39775273)

      Once FB goes public they will be lawfully required to turn a profit by any "lawful" means necessary

      There is no such law.

      • Read "lawfully required" as "forced by shareholders and external parties through lawful (legal) means".

        Maybe there is no statute that says they are required to turn a profit, but there are piles of statutes, case law, regulations, SEC requirements, and "guidelines" which can be used as the basis for a lawsuit and other punishment.

        If you sell public stock, you have to try to be successful or you may suffer all kinds of wrath. Shareholder lawsuits against the board of directors are probably the most common,

  • Tech Version Of The Cold War (Score:4, Insightful)

    by blcamp ( 211756 ) on Monday April 23, 2012 @01:51PM (#39774349) Homepage

    This is not terribly different from different countries on the map lining up with either the US or the Soviets... or going non-aligned.

    It's a good old fashioned "military alliance"... just with patents and lawyers instead of nuclear warheads.

    • Re: (Score:1)

      by bgarcia ( 33222 )
      I think in this case, I'd prefer to be on the side of the 1000 lb patent gorilla - IBM.

      Hopefully all of the companies involved are happy with a standoff, but if things ever escalate, my money's on IBM destroying all enemies with its portfolio.

      • IBM is laughing all their way to the bank, while everybody pays them for the benefit of standing on their side. (In fact, that is not a new strategy for them)

        Don't bet on they destroying anybody.

    • This is not terribly different from different countries on the map lining up with either the US or the Soviets... or going non-aligned.

      It's a good old fashioned "military alliance"... just with patents and lawyers instead of nuclear warheads.

      So, we wait until one of the sides goes bankrupt and Ronald Reagan takes credit?

    • Re: (Score:3)

      by H3lldr0p ( 40304 )

      This isn't the first time this has happened.

      It also happened way back when with the start of the airline industry. Back in 1903, the Wright Brothers started one [wikipedia.org] over the way one controlled a plane. Long story short, WWI started and seeing as how planes were a cool new war toy, the US government stepped in and made them make peace or else no one would get the patent money.

      I have to wonder what's it going to take to get that to happen this time around.

  • Will the patent-go-round continue, or has Facebook loaded up for a good old-fashion Mexican standoff?"

    In Soviet Mexico, we just call them "standoffs".

  • At some point the world is going to wake up and notice that the U.S. forces it's patent and copyright laws down everyone's throats while all the big U.S. companies have agreements to ignore each other's IP.

    Basically they're forcing everyone to adopt IP law while they don't (hypocritically obviously) but also telling them that it's for their good while not doing it themselves.

  • How exactly do you know whose patent you're potentially infringing on? Do searches on the US patent website return correctly updated info?

  • Brilliant (or not so much) (Score:4, Insightful)

    by Shamanin ( 561998 ) on Monday April 23, 2012 @02:09PM (#39774583)

    Facebook, it's the new AOL!

  • Facebook is a great, big, popular walled garden. AOL was a great, big, popular walled garden. There's probably at least a few patents in the bunch that FB steps on that they would prefer to own, even if they are half way to expired by now.
  • Perhaps there is something in this bunch that helps FB against the Yahoo suit. That is still on, right? Such silly games we force companies (and people) to play.
  • Now Facebook will be able to mass produce drinks coasters with impunity.
  • Oh, the tangled web They weave. When Patent Guilds Conspire as thieves. Patents today have become like some magic amulet from D&D. You only have to possess it for a short time to impart its magical protection to you forever. After that, you're free to pass (sell) it on to the next troll who needs to up his powers. Does anyone really believe that MS will not, as a term of the sell, keep an eternal license to the patents just as AOL likely did in its sell to MS? Patents must DIE.

  • Given that software patents are 100% worthless, I hope Microsoft enjoys their donation from Facebook, and AOL enjoys their cool billion.

    Eeeasy money.

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