Facebook Strikes Patent Deal With Microsoft Worth $500 Million

After recently purchasing a number of patents from IBM, Facebook has further strengthened its stance after striking a deal with Microsoft to purchase a portion of the patent portfolio it acquired from AOL recently for $550 million.

Microsoft only recently purchased 925 patents and patent applications from AOL as well as a license to AOL’s remaining patent portfolio, which contains around 300 additional patents that were not for sale. The agreement today means that Facebook will obtain ownership of approximately 650 AOL patents and patent applications, as well as a license to the patents and applications that Microsoft will purchase and own.

Microsoft will still own roughly 275 AOL patents and applications, a license to the 650 AOL patents and applications that Facebook now owns and a license to approximately 300 patents that AOL did not sell in its patents auction originally.

In a announcement made on the Facebook site, the executive vice president and general counsel of Microsoft Brad Smith said that the deal “enables us to recoup half of our costs while achieving our goals from the AOL auction.”

The spending spree from Facebook comes after Yahoo! sued Facebook for 10 patent infringement back in March. The move is a case of Facebook wanting to cement their position and ensure that a similar scenario won’t occur in the future. Their upcoming IPO, which could see the company valued up to $100 billion, is also a reason for the purchases; the additional patents may make investors feel reassured if they want to buy shares from the company.