Forget Apple V Samsung. The latest patent row is between Internet giants Yahoo V Facebook over News Feeds and messaging.
Facebook won’t give money away too easily to Yahoo, analysts believe.
Troubled web giant Yahoo has accused The Social Network of nicking ten “cutting edge” patents relating to its advertisement technology, and cloning other patented technologies for Facebook’s News Feed, Premium Video Comment Ad’s and messaging.
In fact, “Facebook’s entire social network model, which allows users to create profiles and connect with, among other things, persons and businesses, is based on Yahoo’s patented social networking technology,” the former Internet darling claims.
The way Facebook displays its advertisements and using a pay-per-click model to prevent click fraud, also infringes Yahoo technologies, it alleges.
“Yahoo’s patents relate to cutting edge innovations in online products, including in messaging, news feed generation, social commenting, advertising display, preventing click fraud and privacy controls,” according to the case filed at U.S. District Court, Northern California, reports BBC.
“Yahoo is harmed by Facebook’s use of Yahoo’s patented technologies in a way that cannot be compensated for by payment of royalty alone.” However, there’s no word on whether Yahoo sought to settle out of court prior to the action.
Mark Zuckerberg’s giant said it was “disappointed” with its business partner Yahoo’s surprise legal action, which if pursued, could cost it millions in lawyers fees and court litigation, but denies the charges.
“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,” it said.
However, the network which now boasts 845 million friends, said it has no forewarning about the litigation:
“Once again, we learned of Yahoo’s decision simultaneously with the media,” but pledged to “defend ourselves vigorously against these puzzling actions.”
The case comes as Facebook is getting set to go public later this year, which may coin the network up to $10bn and place its total value at a whopping $100bn – making it the biggest IPO ever.
Yahoo has suffered at the hands of rivals like Google in recent years as its search platform dived in popularity with the onslaught of Twitter, Facebook and other sites, and suffered management discontent, falling share price and profits.
The troubled giant pulled a similar move on rivals Google back in 2004 – which ended in Google coughing up 2.7m shares to settle the case, and may suggest Yahoo is now looking to get a piece of Facebook’s lucrative share portfolio also as a payoff.
Or else get a massive payout, which is what some industry watchers believe Yahoo are after, believing Facebook will be under pressure to settle as its IPO looms.
However, technology analyst Colin Gillis reckons believe Mark Zuckerberg wont be giving any money away too easily.
“There’s an air of desperation about this – it’s unlikely that they will get easy money from Facebook. This isn’t going to derail the IPO,” Gillis told the BBC.