Microsoft buys Netscape Web patents from AOL to attack Google

Microsoft buys Netscape Web patents from AOL to attack Google

Summary: Microsoft didn't just buy AOL's patents, they bought what was left of its one time fierce Web browser rival Netscape's intellectual property to use in attacking Google's Android and Chrome.


Netscape patents matter once more as Microsoft tries to buy them from AOL.

Netscape matters once more as Microsoft tries to buy its patents from AOL.

When AOL agreed to sell more than 800 patents to Microsoft for a cool 1.1-billion in cold cash, it didn't just sell patents. Microsoft seems to have bought, according to AllThingsD, the “underlying patents for the old [Netscape] browser." However, AllThingsD may not have realized just how incredibly vital those Netscape patents are to all Web services and browsers.

There was a time when this deal would have been enormous news. Netscape was once a fierce rival to Microsoft. Indeed, it was Microsoft's illegal attacks on the Netscape browser that led both to Netscape's eventual decline and death and the Department of Justice's taking Microsoft down a peg.

Netscape, today, though is little more than an obscure brand name, a URL and an ISP, which AOL will keep, and little else. Indeed, in AOL's Security & Exchange Commission 8-K describing the deal, AOL merely states that, in addition to selling Microsoft patents and granting them the right to use all of AOL's other patents, “The transaction is structured as a purchase of all of the outstanding shares of a wholly-owned non-operating subsidiary of the Company and the direct acquisition of those patents in the portfolio not held by the subsidiary.” What is “that non-operating subsidiary? That would be Netscape.

Guess what? This is still gigantic news.

Microsoft certainly doesn't have any plans to bring back the Netscape browser. AOL stopped developing it years ago. Its code-base eventually became the Firefox Web browser. Netscape's intellectual property (IP), however also included such universal Web browser mainstays as Secure Socket Layers (SSL), cookies, and JavaScript. It's these old Netscape patents that Microsoft is paying a billion bucks for. And, you know what? For a mere billion Microsoft got a steal of a deal.

For example when Netscape patented SSL back in 1997 the company said it had no plans to start charging developers for the source code or to charge for an SSL license. Will Microsoft will take such an attitude towards letting others use this universal Web security standard? Come on! Will the New York Yankees try not to beat the Boston Red Sox?

Could this deal really be about Microsoft trying to get a bigger share of the online map and directions business?. Maybe. But, the cookie, JavaScript, and SSL patents are so fundamental to the Web that I have to think they're the real reasons why Microsoft pulled the trigger on this deal.

Indeed, while AOL and Microsoft would like to see this deal go through within 18-days I expect it will take much longer. I expect lawyers are already at work on briefs objecting to the deal to the Federal Trade Commission (FTC) at this very moment. How ironic is it that more than a decade after United States vs. Microsoft came to its end that Netscape's fate will once more emerge as a legal issue for Microsoft. Still, if Microsoft can get the patents, it will be worth the billion plus all the legal expenses they'll need to pay before the deal is done.

So what will Microsoft do with these core Web patents? My bet is that they'll use them, or threaten to use them anyway, against their top rival: Google. Consider, Chrome is on its way to overtaking Internet Explorer as the world's most popular Web browser.. Microsoft wants Windows 8 to be a major player on tablets and smartphones, and Google's Android is one of the leaders there. What better way to try to trip their opponent than that early 21st century business favorite tactic: the patent lawsuit?

Related Stories:

AOL's patent sale to Microsoft: stripped clean, or savvy move? Microsoft's purchase of AOL patents may be about a Google map war AOL, Microsoft announce $1.056 billion patent deal

Topics: Browser, Google, Legal, Microsoft, Security

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  • SVJN's assumptions presented as facts.

    So many assumptions presented as facts. If there was a voting mechanism for your articles, they would have disappeared like the stupid comments of the Linux Geek and the other trolls around here.

    EDIT: And I just helped SJVN earn his bread by commenting !!!!
    • I agree, he never offers facts, just lines like

      [i][b]Could this[/b] deal really be about[/i], ect.

      He claims that Android is one of the leadersd in tablets, yet there are only two tablet operating systems on the market at the moment: iOS, and Android, which is a far distant second. Google probally assumed that there would never be an ARM based version of Windows, and have now become worried about Windows 8 as there is an ARM based version for tablets.

      I believe that Google is worried about ARM based Windows 8 tablets overtaking Android, so they spent (overspent, by many an analyst estimation) 12 billion on Motorola.

      I believe the more accurate assesment is that Microsoft is well aware of Google's purchase of Motorola as an attempt to try and derail Windows 8 on a tablet, as they see it as a threat to Android's future on a tablet, and have countered by purchasing these patents from AOL.

      It is a logical assumption,as what better way to try to trip up Windows 8 push onto ARM based tablets than that early 21st century business favorite tactic: the patent lawsuit.

      Tim Cook
      • I'm sure Windows XP Tablet Edition

        Has out sold whatever Android sold in the "tablet" arena... lol
      • Really, x21x

        you mean the XP tablets from twelve years ago? Or are you refering to the stellar sales of the Xoom and others?
        Tim Cook
    • what are you talking about?

      My comments are based on well documented facts like this:
      M$ and other patents trolls are threatening the software freedom with invalid patents. We the community, are fighting back on behalf of the people all over the world!
      The Linux Geek
    • Steven may have a few valid points here, though..

      Especially where a company with Microsoft's reputation is concerned, you should always ask yourself "why would they do.. xxx". In most cases, you can chalk SJVN's articles as flamebait, but in this case, I have to agree with him that what AOL says MS is getting doesn't pass the smell test on its own.

      A billion dollars for a "non-operating entity (that used to make a relatively slow and bloated web browser - which would be pretty useless by today's standards), oh yeah, and a few piddly patents."
      • I disagree

        Netscape was fater than Iexplorer but MS did some tricks with Iexplorer... Thanks to Netscape we have Firefox...
      • @pepe-el-Toro

        @pepe-el-Toro are you kidding? Netscape 4+ was an absolute hog. IE4+ and IE5 swept the floor with it in speed and stability (that's a biggie in a MS product, don't you think?). In fact, I would dare to say that the buginess and slowness of NS4+ was what killed it. Had it kept the pace in speed and usability, it would have survived ... longer anyway. At the time, people were sympathetic towards NS, but its browser became too much of a pain to use.

        Don't try to fool people who were not using web browsers at the time.
    • If these patents were so fundamental

      @SJVN If these patents were so fundamental why on earth didn't IBM or Google or some other "FOSS champion" tried to snatch them before MS? Oh well, it's too late now. If nobody else gave a d@mn before, then can continue doing so. Or what? Will the extremist GPL clowns challenge this in court spending huge amounts of money along the way?
    • On an equivalent series of assumptions one could argue that........

      .......Microsoft are simply making sure that both flavours of Win8 in tablet space are legally bullet-proof in the event of any attempt by rivals to shut them out via the courts.
    • The headline is stated as fact

      But in the blog it's just another SJVN speculation.

      I also think it's about time we had voting on blogs as well as posts as the number of posts SJVN receives are the result of a lack of quality rather than an agreement with his outlandish claims.
  • Defensive patents

    It hasn't been noticed, but Microsoft isn't big on the suing. While it has leveraged its patents, it has done so to negotiate royalties, and not to start big high profile lawsuits.

    My guess is that the newly enlarged patent portfolio is a defensive measure - nobody but a pure patent troll without product would dare sue Microsoft over any web-tied technology now. The countersuits would be lethal.
    • At One Time

      Once that was a fair observation. But I believe Microsoft is the plaintiff in a suit against Barnes & Noble for the Nook and against Motorola.

      No, the sad reality is that these days all the tech giants, whether we're their fans or not, are up to their arm pits in the big muddy of competing via courts or earning from others' engineering.
      • I may be mistaken........

        .....but isn't MS the *defendant* in the Moto case? What I heard was that Moto was suing MS, not the other way round. AFAIK MS has been the plaintiff only a couple of times or so in the last decade. As I said below that does not make them members of the Sunday school choir but in comparison to many other major companies they are definitely not usually the first to reach for their lawyers.
    • Not defensive anymore

      Microsoft lost the ability to say "this is just for defense" once they initiated the TomTom lawsuit over the FAT patent in 2009. They're a well known patent aggressor these days.
      • Not defensive any more?

        Really? You are saying that the moment they sue even once they become a patent troll? What on earth, by that measure, does that make several very high profile companies who are currently keeping a large number of lawyers in business then? Do we have to invent a new category for them - perhaps the uber-patent troll category, the mega-patent troll category etc. etc? It is a perfectly fair point to make that MS is not especially litigious in comparison to several other very major companies in the industry. That does not make them members of the Sunday school choir but it is still a legitimate point. Inconvenient I know, for those who (literally or figuratively) always spell the company's name with a dollar sign when they comment on anything it does but they will just have to put up with it.
      • You are talking from emotion

        not fact.

        I find it interesting that the moment Google is looked at as an agressor, you are quick to jump to their defense, even after all that has been released about them from former employees that have left to pursure that which Google claimed they offered, but had no desire to deliver.
        Tim Cook
    • You mean a Patent Troll Like

      Mosaid? The Patent troll that Microsoft granted an undisclosed number of vital Nokia Patents to? When Apple sues to protect their IP (and patents) The Windows Trolls come out from under their bridges in droves to bash Apple. Yet when Microsoft sues to harm competition, these same Trolls cheer is as protecting the world from Evil company "G".
      Jumpin Jack Flash
  • Is this history repeating itself?

    If Microsoft dared to use those patents to hold other companies hostage then it might as well press the nuclear button. Microsoft almost got broken in half because of the tricks it pulled. It would be insane for them to even contemplate doing it again. Not least if they do, I imagine the whole patent office and patents in general would HAVE to be looked at, as the outcry would be enormous.
    • Since the same corporate culture

      Is in place at Microsoft, it's only a matter of time till we see the same behavior again. Microsoft is already promoting the leveraging of their monopoly position of Office suites, to create a monopoly n mobile phones
      Jumpin Jack Flash