New Yahoo CEO Scott Thompson’s first big move was to try to shake down Facebook with a number of bogus-sounding patents claiming that Yahoo had invented aspects of social networking and online advertising.We say “try to shake down” because the shakedown seems to be failing.
Facebook’s first move after being sued by Yahoo was to counter-sued.
Then, just moments ago, Facebook announced it has purchased 600 patents from Microsoft for $550 million.
From the moment Yahoo began going down this road – call it Patent Troll Way – we warned that it was a bad idea. We warned it would alienate Yahoo in the Valley, damage employee morale, and harm what had become a fruitful partnership with Facebook.
Thompson looks particularly bad in comparison to AOL CEO Tim Armstrong.
Also a CEO of a patent-rich Internet company in need of a turnaround, Armstrong found a way to monetise that portfolio in an industry-friendly way: by selling a chunk of it to Microsoft for $1 billion. Those patents are some of the ones Microsoft sold to Facebook today. Now, Armstrong’s company is now $1 billion richer and find itself allied with powerful friends Microsoft and Facebook.
Yahoo, meanwhile, is all alone and in a relatively weaker IP position than where it was before. Whoops.