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Facebook Buys 750 IBM Patents

Soulskill posted more than 2 years ago | from the business-imitates-black-market-weapon-deals dept.

Businesses 46

eldavojohn writes "Considering IBM's portfolio gained 6,180 last year alone, it's not a huge number. But after a dispute with Yahoo a couple weeks ago, Facebook has purchased 750 patents from IBM. That's over thirteen times the 56 they were reportedly holding. The humorous rumor is that Yahoo might have been licensing these patents from IBM. If you can't beat 'em, buy the patents they're licensing from another company. Another rumor is that Facebook might be just getting started in their bid to expand their patent portfolio (video). No word yet whether the purchased patents directly pertain to Yahoo's infringement claims on messaging, privacy controls, advertising, customization and social networking."

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If you can't bring the troll to the bridge (0)

Anonymous Coward | more than 2 years ago | (#39456391)

Bring the bridge to the troll...

Software patents are bad (5, Insightful)

Anonymous Coward | more than 2 years ago | (#39456415)

The fact that a single company can get over six thousands patents in a single year is proof enough that it's a bad idea to allow software patents.

Competition and free market is now impossible because of these stupid patents that should never have been granted in the first place.

Re:Software patents are bad (1)

Anonymous Coward | more than 2 years ago | (#39456461)

So setting some arbitrary limit on the number of patents a corp can get is going to encourage a free market?
"Sorry IBM, you've had your thousand patents for the year - let someone else invent things for a change".

Re:Software patents are bad (1)

Anonymous Coward | more than 2 years ago | (#39456525)

The sheer magnitude of their annual patent count seems to imply that these patents are fairly trivial, and probably not worth patenting for any reason other than squeezing money out of people who dare to make their own things.

Re:Software patents are bad (5, Interesting)

bws111 (1216812) | more than 2 years ago | (#39456571)

It implies no such thing. IBM is a very large company, with lots of researchers, developers, and engineers in many disciplines. Now, how about an example of IBM squeezing money out of people who dare to make their own things?

Re:Software patents are bad (4, Funny)

avirrey (972127) | more than 2 years ago | (#39456831)

What AC is trying to say is 64K should be enough for anybody.

--
X's and O's for all my foes.

Re:Software patents are bad (1)

Anonymous Coward | more than 2 years ago | (#39457333)

Ahem, emulators of IBM z [arstechnica.com] systems?

Probably the same for IBM i. IBM has a monopoly on these systems and make a fortune selling vastly overpriced hardware for those of their customers trapped with legacy systems. Oh, so your CPU is too slow? Either pay $$$$$ to unlock it from 100 MHz to 1.9 GHz (because we crippled it when we sold it for $$$$$) or pay $$$$$ for a new system that would cost less than 10% as (high-quality) off-the-shelf PC hardware.

It's a scandal, really. I hope they eventually lose all their customers and go to hell.

Re:Software patents are bad (-1)

Anonymous Coward | more than 2 years ago | (#39457675)

And I hope you get hit by a car and dragged.

Re:Software patents are bad (3, Informative)

bws111 (1216812) | more than 2 years ago | (#39457881)

You will notice that nowhere in that article does it actually say that IBM did sue, threaten to sue, or even send a cease and desist letter to anyone. In fact, all IBM said was that they would not license their software to run on TurboHercules. That some paranoid guy interpreted that as IBM 'threatening' him, well, that is really not IBM's problem.

As for the rest of your little rant: so what? If you need full performance of the machine, you pay for it. If you don't, you don't. Where, exactly, is the 'scam'? And if you think a mainframe provides the same value as off-the-shelf PC hardware, well, then there is really no point in trying to have an intelligent discussion with you. And BTW, the processors run at >5GHz.

Re:Software patents are bad (2)

K. S. Kyosuke (729550) | more than 2 years ago | (#39459997)

You already have the machine. It's been built and delivered to you at a price you already paid. Now they want you to pay again to actually use it. Perhaps it's legal, perhaps it's a good business model for them, but it's kind of weird. It would make sense it the buy was actually considered a lease, but I thought that IBM was prohibited from doing that back in the sixties or so.

Re:Software patents are bad (1)

bws111 (1216812) | more than 2 years ago | (#39468143)

This is completely false. You have and can use (without paying another dime) exactly what you paid for. You did not negotiate for, have built, pay for, and receive a number of chips and wires. You negotiated for, had build, paid for, and had delivered a certain number of z processors running at a certain speed. If you want something DIFFERENT (different number of processors, different speed) than what you paid for, they will charge you money and deliver what you now want. This is nothing at all like a lease, and there is nothing 'weird' about it.

In days gone by (and still today for other vendors), changing the performance of the machine involved changing actual hardware. This is highly inconvenient for the customer. Not only do you have to wait for the new thing to be physically shipped to you, but you also have the risk of outages that always occurs when hardware is changed. Getting different hardware in no way changes the VALUE of the upgrade to the customer, it just introduces potential problems.

Why does IBM have this pricing structure? Because their customers want it. There are advantages to having different performance characteristics available. Most obviously a slower processor costs less to purchase than a fast one. Just as important (or maybe even more so), mainframe software is priced by the capacity of the machine it is running on. It is advantageous to a customer to be able to have the slowest processor that gets his workload done.

Re:Software patents are bad (0)

Anonymous Coward | more than 2 years ago | (#39458657)

So setting some arbitrary limit on the number of patents a corp can get is going to encourage a free market?

Since patents are the polar opposite of a free market, yes, yes it would.

For those who don't get it: a patent is a purchasable piece of law, it has the same effect as regulatory capture on the market. You go to the patent office and file for a special law that makes it illegal for people to compete with your business. Sure, that has "free market" written all over it, in the "free money for the government" sense at least.

[Patents were created to stop people protecting their stuff with trade secrets so that if the inventor died or the company went out of business then the knowledge wouldn't be lost. If you look at this concept and the bigger picture then compare it to the way things are then you can see how bullshit the system is now; any crap that could be figured out easily via reverse engineering or, worse, just staring at it for long enough and thinking about how you could build something similar is just not worth offering patent protection]

Re:Software patents are bad (3, Informative)

Surt (22457) | more than 2 years ago | (#39456499)

IBM doesn't get all that many software patents. Theirs are mostly hardware innovations.

I wonder how long... (1)

Tynin (634655) | more than 2 years ago | (#39456447)

I wonder how long before they start to Edison these patents?

old news (-1, Troll)

Anonymous Coward | more than 2 years ago | (#39456495)

get with it, Slashtard

Patentnopoly (5, Insightful)

PolygamousRanchKid (1290638) | more than 2 years ago | (#39456515)

It sounds like the board game "Monopoly" needs an update. Who cares about hotels on Boardwalk and Park Place? Own the most patents, and charge the highest licensing fees, and you win!

"I have one word of advice for you, son, Patents! Not plastics, Patents!"

Re:Patentnopoly (2)

GeckoAddict (1154537) | more than 2 years ago | (#39458133)

Forget go, you collect $200 for each player just for it being your turn!

Re:Patentnopoly (2)

million_monkeys (2480792) | more than 2 years ago | (#39458235)

You should patent your idea as "method to derive entertainment from the current state of the patent system".

Re:Patentnopoly (1)

bill_mcgonigle (4333) | more than 2 years ago | (#39458823)

Own the most patents, and charge the highest licensing fees, and you win!

I have a suggested modification to the rules, since patents still exist in 2012: nobody plays until one of the players initiates litigation. At that point all the other players cooperate and nuke him from orbit. Play again ceases until somebody decides to litigate. Repeat until the game ceases to exist.

Idea: If patent changes hands, becomes public (2)

Benji Minoskovich (1266090) | more than 2 years ago | (#39456553)

This might be a crackpot idea but it just popped into my head so I haven't thought it through...

As a compromise to combat patent trolls, litigation, the stifling of innovation, etc., how about changing the law so that once a patent changes hands it enters the public domain or ceases to be. It's imperfect, but has many benefits.

It would protect the initial inventor/patentor. You wouldn't have the same outcry as if you banned patents all together. However, is also a limitation as it would not stop litigation brought on by the original inventor. But it would put an end to patent trolls and would enable patents to enter the public domain at a much quicker rate. Sure, patent transactions would slow, but it's not unthinkable that a company would purchase a patent to protect itself from a lawsuit knowing that that very purchase will destroy the patent.

Re:Idea: If patent changes hands, becomes public (1)

bws111 (1216812) | more than 2 years ago | (#39456649)

The biggest effect that would have would be harm to the actual inventors. And yes, it is pretty unthinkable that a company would spend real dollars to purchase something that has no value. If the owner of the patent is unwilling to license the patent for a reasonable fee, what makes you think they would be willing to sell it for a lesser price?

Re:Idea: If patent changes hands, becomes public (0)

Anonymous Coward | more than 2 years ago | (#39456791)

That wouldn't work. Remember when you technically couldn't sell domain names? So the answer was for the lawyers to split off a "subsidiary" that owned the domain name. Then the buy would purchase this subsidiary and merge it into their company. So technically, the ownership of the domain never changed. I suspect the same technique is still used with IP addresses.

My point is that the same technique would work in the scenario you are talking about. Surface changes like that will not stop lawyers.

Re:Idea: If patent changes hands, becomes public (1)

Digicrat (973598) | more than 2 years ago | (#39456797)

This might be a crackpot idea but it just popped into my head so I haven't thought it through...

As a compromise to combat patent trolls, litigation, the stifling of innovation, etc., how about changing the law so that once a patent changes hands it enters the public domain or ceases to be. It's imperfect, but has many benefits.

It would protect the initial inventor/patentor. You wouldn't have the same outcry as if you banned patents all together. However, is also a limitation as it would not stop litigation brought on by the original inventor. But it would put an end to patent trolls and would enable patents to enter the public domain at a much quicker rate. Sure, patent transactions would slow, but it's not unthinkable that a company would purchase a patent to protect itself from a lawsuit knowing that that very purchase will destroy the patent.

I like that idea, though having it expire immediately upon changing hands would just prevent them from being sold in the first place. I think a far better solution (as in easier to get legislated) would be to impose a "half-life" on patents. Each time a Patent is sold/transferred the remaining time until the patent expires is cut in half. A win-win all around.

For that matter, such a rule would work nicely for copyrights to. Particularly if the half-life rules are crafted to apply to biological people and not corporations. So if an author/artist passes away and the copyright is passed on instead of entering the public domain, the remaining duration is at least cut in half.

Re:Idea: If patent changes hands, becomes public (1)

larry bagina (561269) | more than 2 years ago | (#39457479)

I suggest limiting patent infringement damages to the actual value of the patent. If a non practicing entity (aka troll) buys a patent for, say $5,000, they can't reasonably claim damages in excess of that amount. (Obviously, that's the maximum amount, not the amount as a company could play pricing games to inflate the value).

For a practicing entity (particularly one that invented the patent), establishing the value is more difficult, but they could limit it to stopping the patent infringement plus expenses. A legitimate company uses their patents to differentiate and improve their products so that alone should be sufficient reward.

Re:Idea: If patent changes hands, becomes public (2)

rolfeb (1218438) | more than 2 years ago | (#39457673)

There's probably a bunch of interesting ways that [software] patents could be modified to make them work better. For example,

1. Patents can only be sold by individuals. If a company owns a patent, it can only be transferred to another company if the company is bought out.

2. Once a patent has been granted you have 18 months [say] to come up with a concrete implementation and sell N units. Otherwise it lapses into the public domain.

3. You cannot sue for infringement of a patent unless you have a concrete implementation and sell N units. If people infringe, you can sue them once you've got your product out there.

4. An annual company tax on patents. The more you have, the more you pay. Tax collected goes into improving the patent system.

There are probably issues with all of the above. I haven't thought them through :-)

Unfortunately, as long as the companies that abuse the system and the government don't want change, it's not going to happen. That's why I'd also like to see some large company get smashed by another. It might make people sit up and take notice.

750 seems like a lot to me (5, Interesting)

timeOday (582209) | more than 2 years ago | (#39456565)

Patents are like movie scripts - most of them never go anywhere. If I were managing IBMs IP I would be more proud of selling 750 than being granted 6000, because it's an external validation of the quality, as opposed to quantity, of the patents. (And by "quality" in this case I really just mean "marketability," or "return on IBM's investment in research," as opposed to something harder to quantify, like scientific merit).

Re:750 seems like a lot to me (0)

Anonymous Coward | more than 2 years ago | (#39456725)

I believe that is 15 metric Edisons.
Definitely a lot.

Disheartened Developer (5, Insightful)

mikeytag (1835928) | more than 2 years ago | (#39456613)

As a developer, it really disheartens me to think that any application I create that becomes popular is likely to be litigated against for patent violations. I've never searched for patents or seen one and thought "AHA! That's how I'll make this algorithm!" No, I just code and create logical solutions to problems that are presented.

No one should be able to claim ownership of the fact that 2 + 2 = 4 and force others to always use 3 and 1 to do addition for the next 20 years. God forbid, someone patents 3 + 1 = 4!!!

Re:Disheartened Developer (2)

rolfeb (1218438) | more than 2 years ago | (#39457713)

I think it's probably not that bad. All software out there infringes on multiple patents.

The vast majority will never see a lawsuit for various reasons:

- The invention is not obvious (especially with software patents)
- You're not a big enough target to make it worthwhile
- The patent is only used for cross-licensing / intimidation purposes
- The patent holder would be too embarrassed to sue over a patent they shouldn't have been granted in the first place (I'd like to think this happens)

Re:Disheartened Developer (1)

bill_mcgonigle (4333) | more than 2 years ago | (#39458817)

I just code and create logical solutions to problems that are presented.

commie.

Re:Disheartened Developer (1)

phantomfive (622387) | more than 2 years ago | (#39458951)

If you ever generate $10billion, you can be sure you will get legal problems, no matter how you do it. Even if it's just from some guy who tripped over your doorstep on the way in.

We should all hate Facebook (0)

Anonymous Coward | more than 2 years ago | (#39456625)

Make it's because the movie convinced me that Mark Zuckberg tries really hard to be an asshole. I can sense it. Facebook is going to become the do more evil company of the 22nd century.

insects (1)

Sav1or (2600417) | more than 2 years ago | (#39456641)

I always feel like an insect watching titans move around and sue each other when i read stories like this.

Re:insects (1)

petsounds (593538) | more than 2 years ago | (#39457303)

By the time corporations are going around suing each other over patents, they're just walking dead. Thoughtfulness, innovation, and often humanity has already long passed from their corpus and what's left is a rotting stench of lawyers and predatory executives.

Time to dump software patents? :) (4, Interesting)

Xtifr (1323) | more than 2 years ago | (#39457023)

Given the recent SCOTUS decision about the patentability of "laws of nature" (Mayo v Prometheus), following right on the heels of Bilski, I would be dumping software patents as fast as I could, and would be overjoyed to find someone like Facebook willing to pay me for them.

Once again, IBM proves that they're no dummies. :)

Re:Time to dump software patents? :) (1)

guttentag (313541) | more than 2 years ago | (#39457941)

Given the recent SCOTUS decision about the patentability of "laws of nature" (Mayo v Prometheus)...

I've long said that when condiments [wikipedia.org] start suing mythological figures [wikipedia.org] over whether the laws of nature are imaginary property [scotusblog.com] , we can officially say that things have gotten out of hand. Everyone thought I was joking, but apparently, we have reached that point.

Re:Time to dump software patents? :) (1)

In hydraulis (1318473) | more than 2 years ago | (#39465041)

So.

It has come to this.

Money chasing Money (1)

dak664 (1992350) | more than 2 years ago | (#39457111)

To me, mass patent purchase means they have more money than they can usefully spend on product development. This because the stock market disconnected from real product development a long time ago, now it's just money chasing money. There may be some savings in patent licensing, almost certainly not enough to justify purchase.

House of Cards (4, Insightful)

beenThereBefore (2602207) | more than 2 years ago | (#39457181)

The software patent end of the industry is a house of cards. Currently it only holds up because everyone plays along. In order to sustain the house of cards all the major players have to cross license all of their patent portfolios. No one really even knows which patents they are violating, or being violated at any time.

You only see small skirmishes play out, like Motorola vs Apple, major ones are always settled. The major players use this cross licensing to try and keep small and medium sized companies from coming into their space. Once you generate enough revenue to put up a good fight, they have to let you in 'the club'. Facebook crossed that threshold. FB will now cross license with all the other players.

A system initially designed to foster innovation is now a detriment. The mass cross licensing of patents should be considered in anit-trust light. It allows the major players to share ip, while blocking the others and keep their prices artificially high as a result. No different than direct collusion. The system should be unwound.

I wish companies would do the right thing instead. (1)

s.petry (762400) | more than 2 years ago | (#39457391)

Best bang for the buck is to spend lobby money on correcting the problem. I hoped long ago that Google and Facebook, who have been built on Open Source knowing the dangers and harm of "Business Process Patents", would fight to fix the problem. Instead, both seem content to play the game.

The worst part, is that it costs them more money to play the game than it would to lobby to correct the issues. I still have hope, especially considering how Google has been beating up Oracle like they are a Kanya girlfriend.. but it's pretty far out there.

Re:I wish companies would do the right thing inste (2)

guttentag (313541) | more than 2 years ago | (#39458259)

Doing the right thing always seems logical, but when you look at the bigger picture it's not always effective.

Take your commute, for instance. If the people around you did the right thing, they would leave three seconds between their bumper and the car in front of them. Everyone would hit their brakes less frequently, traffic would flow more smoothly, there would be fewer accidents, less wear and tear on the road, and everyone would get where they were going faster and with less stress. Makes sense, right? But then some asshole will exploit the spaces that each of them have left, weaving in and out, forcing people to hit their brakes, causing waves of slowdowns and possibly accidents.

This is nothing new. Alexander Hamilton observed that people act mostly out of self-interest. The solution is to create a system that makes it in one's self-interest to do the right thing.

In theory, the solution here is to create a system where it is in the interest of a company to hold a large stable of software patents and not use them. In other words, if you can demonstrate that you hold a significant patent and have allowed small competitors to do things that don't blatantly violate your patent but might be in a grey area, for every year you do not use it like a hammer to crush competition, you get a tax break or some other incentive. But if you have a challenge from some significant threat, you still have the option to exercise your right to litigate... you just forfeit your tax break. The system should also make it more difficult to successfully litigate with a software patent. Therefore the company is forced to make a choice and decide which is in their best interest: litigation or the incentive to not litigate. In the process, the greater good is served because the patent is effectively held in trust by a company that is not likely to use it unless it's absolutely necessary, and this protects everyone from patent trolls.

Companies really shouldn't focus on patents as much as they do, because the idea that a patent really protects your intellectual property is flawed. At the end of the day, anything you patent here is just going to be copied and sold in China or India, anyway. India recently [reuters.com] allowed [slashdot.org] a local drug company to copy a cancer drug patented by Bayer so it can sell it for 97% less, so long as it pays a portion of the proceeds to Bayer, effectively ignoring Bayer's R&D costs. And China... well... anything goes in China with regard to patents and copyright as long as it's not deemed a threat to the Party. I couldn't find an e-book copy of K&R anywhere for sale... but you can download it in PDF format for free from Chinese universities.

Most IBM patents come from ordinary employees (2)

gelfling (6534) | more than 2 years ago | (#39457553)

Doing a little work on their own with little guidance from management. There's a patent program where, they award a few dollars and give your these impressive certificates for successive levels of patent applications and ultimately, an award or two. Because keep in mind there's a huge difference between an application and an award. In order for an application to make it as far as being submitted to the government, it has to pass through an army of attorneys at IBM.

If you are smart enough and fortunate enough to make it through that gauntlet. then the patent goes into a huge database where a different organization scours the countryside hither and yon looking for people who might either buy them, license them or potentially infringe them in which case another battalion of attorneys gets to work.

The fact that IBM even parted with this property means they sold them for more than what they were worth to IBM. And facebook is in way over their depth if they think they're getting the better of Big Blue.

Re:Most IBM patents come from ordinary employees (2)

JaredOfEuropa (526365) | more than 2 years ago | (#39457829)

The fact that IBM even parted with this property means they sold them for more than what they were worth to IBM. And facebook is in way over their depth if they think they're getting the better of Big Blue.

The patents may be worth a hell of a lot more to Facebook than to IBM. If these things pertain to instant messaging, online gaming platforms, managing online user profiles, ranking through friends, virual currency, and all the other crap Facebook is doing or planning to do, then IBM's price will be well worth the fee. While they may be next to useless to IBM, Facebook could use such patents to defend against suits from competitors, or sue those competitors in turn.

Re:Most IBM patents come from ordinary employees (1)

gelfling (6534) | more than 2 years ago | (#39458183)

It's highly unlikely fb would want to use intellectual property they didn't already have a very clear sense of needing to use it for their own deployment and not in any financial or legal faculty in order to punish someone else. If Yahoo or Microsoft were to sue fb for infringement against property owned by IBM then they'd have to contend with the armada of IBM and not fb, and that would not be very wise. IBM fought the US government to a stalemate eventually agreeing to a consent decree that was MORE profitable for them than winning the court case.

Can Older generation of readers explain to me why (-1)

Anonymous Coward | more than 2 years ago | (#39458047)

Can older generation of Slashdot readers explain to a 30 year old, why company such as IBM, that almost single single handedly defined what is PC, that invented shitload of things, that has world famous Watson Research Center....can be destroyed by joke named Facebook or Apple ? Why ?

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