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Facebook, Yahoo Make Peace on Patents, Agree to Shared Ad Deals


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UPDATE: Yahoo and Facebook have put aside their escalating series of patent lawsuits and agreed to work together on future advertising deals.

The deal was sealed on a Friday morning call, AllThingsD reports, as part of the settlement to the companies? patent dispute.

Yahoo posted the announcement on its website saying, ?Yahoo! (NASDAQ:YHOO) and Facebook (NASDAQ:FB) today announced that they have entered into definitive agreements that launch a new advertising partnership, extend and expand distribution arrangements, and settle all pending patent claims between the companies.?

The announcement goes on to say the companies will work together to secure ads that will run on both sites, and further integrate sharing between the two sites: ?Yahoo! and Facebook will also work together to bring Yahoo!?s large media event coverage to Facebook users by collaborating on social integrations on the Yahoo! site.?

The statement includes quotes from Yahoo?s interim CEO Ross Levinsohn (who may now be the CEO), and Facebook?s COO Sheryl Sandberg. Plus this fact: ?Yahoo! has the largest active user base among all news sites that have integrated with Facebook?s Open Graph platform.?

No money will change hands, reportedly, but the companies will partner up on ad sales as well as cross-licensing of patents.

Yahoo CEO Scott Thompson, who initiated the patent lawsuit in March, stepped down in disgrace over his resume in May. Discussions on resolving the lawsuit started shortly after.

Since 2008, the company has cycled through four CEOs. Some speculate that the open position might be more appealing now that the patent fight has ended.

Both companies are eager to up their advertising dollars. Facebook?s April update to its IPO filing showed a drop in ad revenue. And GM caused a stir this year when it pulled ads from Facebook saying they were ?ineffective.?

Yahoo has had major troubles of it own ? staying relevant in the age of social media, especially now it has outsourced its search function to Bing. And the opportunity for a bigger slice of the ad pie is there: the first three months of 2012 showed online ad revenue industry-wide was the highest ever.
info source: http://mashable.com/2012/07/06/facebook-yahoo-make-peace-on-patents-agree-to-shared-ad-deals/

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