Last month, we talked about AOL wanting to sell off their patent portfolio for a serious cash injection into the business and just two weeks ago, Microsoft scooped up the patents for over $1 billion. It seems that Facebook wanted a piece of the pie.
In an effort to take down the evasive Google, the social networking company struck a deal with Microsoft this week to gain access to their newly-acquired patents. Analysts agree that this is a move to shift the power Google has over the Internet and try to balance the playing field. What better way than for two of the biggest forces on the web to join together?
Microsoft announced Monday that out of the 925 patents they bought, 70 percent of them - 650 patents - were sold to Facebook for $550 million in cash, along with another 275 that Facebook now has the rights to, but Microsoft will retain. It is not known yet how the patents will be split among the two companies, however Facebook will end up getting access to patents that regard mobile, the Internet and instant messaging. Sources say Microsoft will hold onto any patents involving search and other proprietary ideas that they probably don't want Facebook to have for competitive purposes.
Lately, building up your intellectual property portfolio has been the number one priority for most of the big guns and this move will help Facebook shore up its portfolio before the expected IPO next month. While one might think this has to do with the lawsuit from Yahoo that might put the social network in jeopardy, an ability to gain an intellectual edge (at least on paper) over Google proves to be the bigger point. Now, these patents, whatever they may be, are more firepower for when Google inevitably steals another idea from Facebook for their Google+ effort. For me, it's the lesser of the two evils winning at this point.
Facebook seems to agree and said in a statement,
Today's agreement with Microsoft represents an important acquisition for Facebook. This is another significant step in our ongoing process of building an intellectual property portfolio to protect Facebook's interests over the long term.
What will we see out of the patent acquisitions? A new timeline next month? I think the latest idea involves some sort of photo vending machine where you insert Facebook Credits, type the letter-number combination of the 10px by 10px thumbnail of an image you want to view and it gets blown up in full size for you to take a look at. Want to tag a friend in it? Another 500 Credits. Perhaps that was just in a freakish nightmare I had. Either way, we'll keep you updated in both the upcoming additions for Facebook and the pending lawsuit they have to handle.
Don't forget about their potential $100 billion IPO, either. Who's buying? Let us know in the comments section below.