If You Can’t Beat Them, Sue Them – Yahoo Threatens Facebook Over Patent Dispute

Will Ferrel ScreamingOnce upon a time, there was a young, innovative and some would even say revolutionary tech company. It affected and inspired so many people all over the world while establishing itself as nothing less than “the future”. Those days are now gone.

It is truly saddening to see what has become of Yahoo. A company that everyone was looking up to and waiting to see what next it will launch next, at some point over the course of time lost its way and simply stopped innovate while mostly relying on existing products.

And now, another forlorn affair is clouding over the once-almighty company…

As first published in the New York Times, Yahoo is threatening to sue Facebook over allegedly 10-20 patents infringements. Apparently, Yahoo is demanding from Facebook some money compensation for proper licensing and usage of its (alleged) patents. Or As Yahoo’s spokesman stated:

“Yahoo has a responsibility to its shareholders, employees and other stakeholders to protect its intellectual property, We must insist that Facebook either enter into a licensing agreement or we will be compelled to move forward unilaterally to protect our rights.”

But why is it such a gloomy affair from Yahoo’s side? If indeed it has some solid legal base that Facebook actually violated some of its intellectual properties (patents), seemingly Yahoo should have all the legitimacy in the world to demand from other companies a pay for the privilege to use these intellectual properties.

However, there are bunch of reasons that puts Yahoo itself on the dark side of this story:

Timing- Did Yahoo just waited until Facebook will file its IPO documents to go on its legal-hunt? This is certainly a sensitive time for Facebook to encounter with legal difficulties that can potentially damage its reputation right before the public will take a “vote” about the social network. These circumstances may push Facebook to settle for a lot more than it would have in other times. Pretty dirty tactic…

Betrayal- Facebook is one of the leading traffic sources of Yahoo. A great example is that 12 out of the top 40 Facebook’s most shared articles for 2011 were in fact, Yahoo’s articles. We can find another (and more impressive) example recently, when Facebook disclosed it is sending 1.6 million visitors every day to Yahoo mobile app.

With this kind of close web-connection and mutual interests, it would have been much more reasonable and logical trying to resolve conflicts between the companies more quietly and without threats. But Yahoo chose another path. In fact, Facebook received the warning simultaneously as the New York Times did. Here’s what Facebook’s spokesman had to say about that:

“Yahoo contacted us the same time they called The New York Times and so we haven’t had the opportunity to fully evaluate their claims.”

Prioritization- The fact that Yahoo is jumping to the main tech headlines only due to this story may reflect about the poor state it is in. It seems that instead of focusing on rolling out new products/features, Yahoo is more occupied by squeezing some extra cash from legal accusations (justified or not).

Scott Thompson’s First Stroke- Right at the beginning of 2012, Scott Thompson was appointed as Yahoo’s new CEO after Carol Bartz been fired few months back. One of his first statements to the media as the new CEO was “We’ll Be Back to Innovation”. Well, so far we didn’t witnessed any sign for innovation while this is actually Thompson’s first move as CEO…

I am hoping that regardless to what will come up with this melancholic affair, Yahoo will return to its roots which are the basics for any technological company for self-existence on the long run and it will start to innovate once again. God only knows we need the competition…

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