The not-so-veiled threats of a couple of weeks ago have materialized, Yahoo has sued Facebook for patent infringement. It dug up a list of 10 patents to hit Facebook with, not targeting particular features, but common functionality in the social network.
Yahoo claims that it was first and that this counts for something, in this particular case, it wants damages and it wants Facebook to stop using functionality based on Yahoo patents.
Of course, Facebook would effectively have to shut down if it were to stop "infringing" on the overly broad patents Yahoo is waiving about.
Given that many if not most software patents, those related to the web in particular, are if not ridiculous, at least vague enough to be understood to mean anything, this not surprising.
The 10 patents Yahoo claims Facebook is infringing on are so broad they not only cover any social network out there, but many other sites as well. There's a rundown of the 10 patents here
, with such gems as a "customized homepage" and "selective sharing."
"These technologies are the foundation of our business that engages over 700 million monthly unique visitors and represent the spirit of innovation upon which Yahoo! is built," were
Yahoo's fighting words.
"Unfortunately, the matter with Facebook remains unresolved and we are compelled to seek redress in federal court. We are confident that we will prevail," it added.
Unofficial sources say that the move comes strictly from the new CEO Scott Thomson. In fact, many at Yahoo, in the technical departments, disagreed with it.
But Yahoo has to appease Wall Street somehow and it seems that this is the best thing it came up with. This, after Thomson gave a rallying cry when he took office citing innovation as the main target.
This is just the first salvo, it remains to be seen how this will turn up for Yahoo, it could go either way. So far though, investors are not impressed, Yahoo shares were actually down after the announcement. Of course, Yahoo shares are down for the day more often than not.
While the move may be all Thomson's idea, it's typical of Yahoo, unfortunately. The company did the very same thing to Google when it was about to have its IPO, like Facebook is now.
Back then, it settled with Google and got some Google shares. Since, Yahoo has continued to languish while Google grew exponentially to become one of the biggest tech companies in the world.
Eight years after the fact, Yahoo is doing the same for Facebook. The social network has had little patience for patent trolls in the past, granted, none were as big as Yahoo. The timing may be a factor, Facebook may opt to settle rather than upset the IPO.
But if one of the most anticipated IPOs in history can be upset by a patent troll, something is not right with either Facebook or investors. Still, Facebook may opt to pay, maybe a few hundreds of millions of dollars, maybe even a billion. Facebook can afford it and it will go on to become bigger and make a lot more money than it is now. Yahoo will continue to be a joke, postponing an inevitable end.
"We’re disappointed that Yahoo, a longtime business partner of Facebook and a company that has substantially benefited from its association with Facebook, has decided to resort to litigation. Once again, we learned of Yahoo’s decision simultaneously with the media. We will defend ourselves vigorously against these puzzling actions," was Facebook's response to the lawsuit.