Isn’t the free market awesome?! Given enough incentives, if instead of going to court, people can end up with walking away with a good deal on both ends. This is what appears to have happened with Twitter and IBM. IBM, as you have probably already heard, is a massive technology company. It has morphed into a services and outsourcing company, but it packs a massive technology portfolio. It is not surprising that companies will run afoul of IBM’s technology. After all, IBM has been around for a long time and has a deep patent portfolio.
This is precisely what happened when shortly before Twitter became a public company last November, IBM announced that Twitter was infringing on some of its patents. Three patents to be precise. It appeared from that day onward that Twitter was getting ready to round up its lawyers and circle the wagons and put up a legal fight. Well, it looks like the dust has settled and IBM announced that it sold 900 of its patents to Twitter. Moreover, the two companies have signed a cross licensing agreement for patents. So, if Twitter ever launches a product that may infringe another existing IBM patent, it will be covered by this cross licensing agreement. Talk about a win-win situation. This is the kind of news we’d like.
Sadly, patent law has been used recently. Not so much to protect innovation, but to really beat companies over the head for negotiation purposes, market positioning, or even outright extortion. This is a good move on both parts. It also shows that IBM is still a major player when it comes to research and innovation.