Investor and writer James Altucher has an interesting post up at TechCrunch about a patent-infringement lawsuit that might soon be lobbed at Google.
The post is called, in typically bold Altucher fashion, “Why Google Might Be Going To $0.”
Here’s the story in a nutshell.
Way back in the 1990s, a computer scientist at Carnegie Mellon created and patented the technology that became Lycos. The patents covered several aspects of monetizing search, such as using algorithms and click rates to determine which search ads are most revelant.
Later, when a company called Overture applied for patents on search monetization, Overture was granted several patents but refused others–on the grounds that Lycos had already patented them.
Still later, Yahoo used the search patents Overture was granted to sue Google for hundreds of millions of dollars.
Meanwhile, Lycos cratered.
Well, Lycos still exists, in some form. And James Altucher’s friend recently bought back his search-monetization patents from the wreckage of Lycos.
And he formed a company with them.
And now that company is merging with a public company called Vringo. And Vringo, Altucher says, will use the patents it has just acquired to go into a new business–patent trolling.
James Altucher says he has read all the relevant patents and Google’s description of how its search monetization works and believes that Vringo will have a strong case against Google.
Altucher points out that Google has generated about $67 billion of revenue from search over the past decade, so there’s a lot of money to go after.
So Altucher has also bought Vringo stock.
We’re no fans of patent-trolling. In fact, in most cases, we think it’s pathetic. But this should be interesting. And assuming Altucher’s reading of the patents is correct, we would not be surprised if it results in Google handing over some money to Vringo.
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