Facebook to Buy $550M in Patents From Microsoft

Earlier this month, AOL agreed to sell Microsoft 925 patents and patent applications for just north of $1 billion; now another tech giant is getting a piece of the action. Facebook has pledged to buy some 650 of those patents, or $550 million worth. In the deal, Facebook also gets a license to Microsoft's portion of the portfolio. According to Facebook's announcement, Microsoft ends up with 275 AOL patents, plus licenses to Facebook's AOL patents and the 300-ish patents AOL didn't sell.

"Today’s agreement with Facebook enables us to recoup over half of our costs while achieving our goals from the AOL auction," says a Microsoft rep. For Facebook, it's "another significant step in our ongoing process of building an intellectual property portfolio to protect Facebook’s interests over the long term," says a spokesman. What do outsiders say?

• "The deal is a further sign of the growing importance of stockpiling patents in the arsenal of any big technology company," writes Nick Wingfield for the New York Times. "It also shows how Microsoft and Facebook have gravitated increasingly closer to each other in large part because of a common enemy: Google."
• Writing for ZDNet, Emil Protalinski says it's actually all about Yahoo, not Google. "With public companies like Yahoo targeting it for patent infringement, the social networking giant has stepped up its game. I don’t believe it’s a coincidence that AOL and Yahoo are such similar companies. This is exactly why Facebook is so interested in AOL’s patents: a lot of them cover technologies that Facebook uses, as well technologies used by companies that want to sue Facebook."

(More Microsoft stories.)