Yahoo Blindsides Facebook With Patent Allegations

Yahoo surprised Facebook with a host of patent-infringement allegations Monday, covering areas including advertising, website personalization, social network, and messaging, and apparently stating its case to The New York Times at the same time, giving the social network little time to respond.

Yahoo surprised Facebook with a host of patent-infringement allegations Monday, covering areas including advertising, website personalization, social network, and messaging, and apparently stating its case to The New York Times at the same time, giving the social network little time to respond.

The TimesDealBook blog reported that Yahoo claimed that Facebook is infringing on 10 to 20 patents, and may file a lawsuit if licensing fees aren’t paid.

Yahoo had emailed the following statement to DealBook:

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.

Facebook spokesman Barry Schnitt replied to DealBook:

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.

Relations between the two companies had not been contentious, with Facebook highlighting Yahoo News last week as one of the stronger-performing early adopters of the updated open graph technology.

The timing is poor for Facebook, as well, as it can’t really get into a hissing match while it’s in a quiet period prior to its initial public offering.

The move by Yahoo was not looked upon favorably by the media. Like Kara Swisher of AllThingsD wrote:

Apparently, Yahoo’s new motto: If you can’t beat ’em — and it can’t — sue ’em.

That would be Yahoo — the perpetual 98-pound weakling of the Internet these days — threatening powerful Facebook, which had cleanly bested the Silicon Valley Internet icon by attracting hordes of users with a plethora of popular products and services.

Yahoo has already lost its audience to Facebook, which was most recently followed by its frittering away a commanding lead in display advertising, too.

That would also be the Yahoo whose most recent success in improving its increasingly tenuous connections with customers was, in fact, by deeply integrating Facebook’s social hooks into its web properties.

That would be the Yahoo which has failed time and again to innovate its own offerings so drastically over the years that it has now apparently decided that its first and best strategic move under new Chief Executive Officer Scott Thompson is a shakedown.

Such a cynical move is a play for the cheap seats of Wall Street, given that Yahoo needs to look like it is doing everything it can to turn things around as it faces a proxy challenge.

In other words, in poking Facebook, Yahoo might now learn what it is really like to be defriended.

TechCrunch‘s Josh Constine wrote:

Honestly, this is despicable. After relentlessly stagnating as Facebook innovated, to now try to extort (Co-Founder and Chief Executive Officer Mark) Zuckerberg’s company just as it enters the spotlight reeks of desperation. The only positive news from Yahoo in recent memory was thanks to the viral nature of Facebook’s social graph that Yahoo may says it owns the rights to. Did the Winklevii join Yahoo’s board?

And Mathew Ingram of GigaOM added in a tweet linking to the DealBook post:

Yahoo reinforces its utter lack of ideas and/or strategy by threatening to launch a patent suit against Facebook.

Readers: Do you think Yahoo’s patent-infringement claims have any merit, or does the timing lead you to believe the move was made out of desperation?