Yahoo and Facebook resolve patent fight, strikes deal

facebookExhibiting an example of web fraternity, Yahoo and Facebook has set aside their legal battle on patent rights and entered a licensing and internet partnership on July 6th.


The once iconic web giant Yahoo Inc sued Facebook in March, claiming that the social networking site infringed 10 patents, many of which are related to online advertising technology. The accusation was made under the leadership of ex-Yahoo CEO Scott Thompson.

In recent years, Yahoo has experienced a rough weather and struggled to keep up with the big players like Google, Facebook, and Twitter. Yahoo’s predicament increased ever since they turned down Microsoft’s $44 billion acquisition offer. It has seen four CEOs in last four years and none of them succeeded to retrieve the numero uno slot for the company.

Facebook, on the other hand, has been growing at a tremendous rate. It was worth $104 billion in May this year. In such a situation, the buzz in the industry is that Yahoo might have been trying to squeeze some cash out of Facebook. The social networking company shortly filed a countersuit and criticized Yahoo, which, it said, favored “Litigation over innovation”.

However, it seems that all is well as of now and the disputes have been resolved in a positive manner. Their new tie-up includes cross licensing of patents and collaboration on advertising related matters during major events. It is worth mentioning that there is already an existing tie-up between the two companies, which grants Facebook users access to Yahoo territory.

Sheryl Sandberg, CEO of Facebook, said that they are looking forward to more strategic deals with Yahoo.

Author bio:

Debasubhra Banerjee is an Associate with a Big Four professional services firm.

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