That Internet companies fight each other viciously over access to users and hence to advertisers is obvious. But there is another fight going on, and winning it may not only impact the revenues of these companies but their very survival. This fight is over patents. Yahoo has lots of them and it is engaged in protracted court battles with Google over patent infringements. Google even bought Motorola Mobility for $ 12 billion to acquire the company’s intellectual property to support its legal defense of its Android operating system.
Facebook recently acquired a portfolio of about 750 patents from IBM, boosting its holdings that had numbered only 56. This is to counter claims of infringements of 10 patents made last week by Yahoo. Yahoo said the patents cover technology, which lies close to the heart of Facebook’s service and accounts for “the majority of its revenues”. When companies such as Google and Facebook were in their explosive growth phase, they paid little heed to patents, now they suffer for their negligence.
Source: Financial Times