The idea of buying patents has become a very popular way for multi-billion dollar companies to try and reduce the ever increasing risk of litigation in the technology world.
And possibly because of this, Microsoft have announced that they intend to purchase more than 800 patents, as well as licensing rights to around 300 patents from AOL in a deal worth $1.06 billion.
As mentioned, buying patents seems to be the ‘in thing’ at the moment. Earlier this year, both Google and Facebook have bought a significant number of patents from various other tech companies simply to reduce the change of being sued.
Since announcing the news, AOL’s shares rose more than 40% with the company saying that it plans to pass on a “significant portion” of the proceeds of the sale to its shareholders. Chief executive Tim Armstrong said: “The agreement with Microsoft represents the culmination of a robust auction process for our patent portfolio,”
While Microsoft’s executive vice-president of legal appears, Brad Smith said that: “This is a valuable portfolio that we have been following for years and analysing in detail for several months.”
Currently, Microsoft are tied up with litigation in Germany, where on the 17th April the software giant will appear in court to face claims that It infringed Motorola Mobility’s H.264 video-compression technologies.
Both Microsoft and AOL have said that they expect the deal to be completed by the end of this year.
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