Facebook will pay Microsoft Corp $550 million for hundreds of patents that originated with AOL, beefing up its intellectual property arsenal. The deal gives social network Facebook 650 patents and patent applications and license to another 275 patents and applications. It comes shortly before Facebook is expected to have the largest initial public offering in Silicon Valley history.

Patents have become a top priority for technology companies as many of them, including Google Inc and Apple Inc, become embroiled in patent-related lawsuits.

The patents, which Microsoft bought this year from AOL, cover a broad spectrum of technology, including mobile services, cell phone handsets, advertising and e-commerce, a source familiar with the situation said.

Microsoft trumped Amazon, eBay and other tech companies this month with its more than $1 billion purchase of most of AOL’s patent trove. Valuing patents is a complex process, and it was not immediately clear whether Microsoft profited from the deal with Facebook.

Brad Smith, Microsoft’s general counsel, said in a statement on Monday that the Facebook deal allows it “to recoup over half of our costs while achieving our goals from the AOL auction.”

Facebook was also a participant in the AOL auction, a source said at the time.

The auction included technology rights from AOL’s current and former businesses, ranging from Web browser Netscape and instant messaging service ICQ to MapQuest and early online service CompuServe, the source said on condition of anonymity because the information was not public.

All or nothing

Microsoft bought the AOL patent portfolio knowing that it was an all-or-nothing deal and always planned to sell a large number of them while retaining licenses to them, a source close to the Facebook deal said. Microsoft will retain a license to the patents and applications it is selling to Facebook under the terms of the deal.

The purchase marks Facebook’s second recent move to bolster its patent portfolio, which consisted of 56 issued patents and 503 applications as of December 31, according to a filing with the U.S. Securities and Exchange Commission.

In March, it acquired 750 patents from International Business Machines Corp.

Facebook’s deal with Microsoft comes as the world’s No.1 social networking company prepares for an initial public offering that could value it at up to $100 billion and as it battles Yahoo Inc in court.

Yahoo sued Facebook earlier this year, claiming that Facebook had infringed 10 Yahoo patents, including several covering online advertising technology. Facebook countersued Yahoo in April, accusing Yahoo of infringing 10 of Facebook’s patents.

“Nothing about today’s action changes the fact that Facebook continues to infringe our patents … We see today’s announcement as a validation of our case against Facebook,” a Yahoo spokeswoman said in an emailed statement.

The deal for AOL’s patents, which is subject to regulatory clearance, would help “protect Facebook’s interests over the long term,” the company said.

Technology companies have sparked a frenzy for patents in recent years, bidding up prices in a defensive move to keep competitors at bay.

On July 1, 2011, Apple, Microsoft, Research in Motion Ltd and three other leading technology companies outbid Google to buy wireless patents from bankrupt Nortel Networks Corp for $4.5 billion.

Google quickly responded by successfully announcing plans to acquire Motorola Mobility Holdings, which owns 17,000 patents and 7,500 patent applications, for $12.5 billion.

The agreement between Facebook and Microsoft is the latest occasion that the world’s No.1 online social networking service and the world’s largest software company have teamed up.

Microsoft invested $240 million in Facebook in 2007 for what was then a 1.6 percent stake.

The two companies have forged various business collaborations over the years. Facebook features search results from Microsoft’s Bing search engine in its social networking service as well as video chat technology provided by Skype, which Microsoft acquired last year.

Netflix Chief Executive Reed Hastings serves on the board of directors of Facebook and Microsoft.

If you thought you had seen rapid internet growth in the past couple of years in South Africa, prepare yourself for a data explosion.

Telecommunications giant Cisco’s network index shows that the amount of mobile data (the internet on cellphones, tablet computers and laptops) in South Africa will increase 49-fold over the next four years. In other words, from today the volume of data consumed on mobile devices will more than double each year.

By 2016, 102 000 terabytes of information will be sent every month. This is the equivalent of about 26m DVDs or 283m SMSes a second.

In that year the average mobile internet speed will be 5.4 megabits per second – enough to watch a movie smoothly on the internet. This is vastly different from last year’s average South African mobile internet speed of 374 kilobits a second.

It will be made possible by faster internet connections such as 4G and LTE (long-term evolution), which will soon be available in South Africa.

“In the past we were somewhat conservative with our forecasts,” reckons Kevin Bloch, Cisco Australia’s head of technology.

According to him the network index is a mathematical model that has been pretty accurate for the past five years. It’s the same model that Cisco offers telecommunications companies like Telkom [TKG] and Vodacom Group [JSE:VOD] to enable them to adjust their pricing structures.

The substantial annual growth of mobile data in Africa is greater than in any other global region.

According to Bloch the demand for mobile data is being driven by a couple of factors: more ways to connect (cellphones and tablets and laptops), faster speeds, more users and, most importantly, more video material.

From Cisco’s date it appears that users in South Africa have an insatiable appetite for viewing videos on cellphones and tablets.

This demand is growing so quickly that the company predicts that about 84% of all mobile data will involve video by 2016. Last year it comprised 45%.

Growth in tablet computers, which did not exist two years ago, is also rising markedly. Tablets inherently use more data than cellphones, and Cisco expects the volume of data being sent from tablets in 2016 to be almost twice the size of the internet in South Africa in 2011. That of course includes mobile and fixed-line internet connections (such as ADSL).

The company expects that accessing the internet on mobile devices will becoming increasingly popular. Mobile data is expected to grow three times faster than fixed-line data.

By 2016 the amount of mobile data traffic will be almost 17 times the entire South African internet of 2005.

The company expects that by 2016 there will be around10 billion mobile connections like cellphones and smartphones, considerably more than the anticipated population. According to Bloch this is because people will own more than one mobile device, such as both a cellphone and a tablet.

“This is incredible, given that ten years ago no-one even owned a cellphone,” he said.

*The mobile internet then and now

2011

The monthly mobile data volume on the internet was 2090 terabytes – equal to about a million DVDs or 6m text messages per second.

Cellphones made up 18% of mobile internet traffic.

2016

The monthly mobile data volume is expected to be 102 000 terabytes. That is equal to about 26m DVDs or 283m SMSes per second.

Cellphones will make up 33% of mobile internet traffic.

The amount of mobile data in 2016 will be around 0.1 exabytes, or more than one exabyte per year.

An exabyte is about a billion gigabytes (one byte with 18 zeros).

Kilo, mega, tera, giga, exsa

The first flight of a commercial vessel to the International Space Station in late in April will signal a bigger role for the private sector and open up space tourism opportunities, industry experts and lawmakers say.

SpaceX, owned by internet entrepreneur and PayPal founder Elon Musk, made history with its Dragon launch in December 2010, becoming the first private company to send a spacecraft into orbit and back, under a contract from Nasa.

But its demonstration flight to the ISS next month, carrying 400kg) of dried food, is a key test for the private sector, following the space agency’s decision to axe its space shuttle programme.

George Nield, associate administrator for commercial space transportation at the US Federal Aviation Administration (FAA), said Nasa’s decision was an opportunity for businesses to step in.

“We are all well aware of the historic change that has taken place in the US space programme with the retirement of the space shuttle,” he told lawmakers on the House science sub-committee on space and aeronautics.

“While it is certainly true the launch marked the end of an era, it also represented the beginning of what I am confident will be an exciting future in space for our nation.

“Based on market studies, we expect to see this type of activity result in a $1bn industry within the next 10 years,” he said of increasing commercial interest in space.

SpaceX said on Tuesday that Nasa has not yet granted final approval of the launch date, pending completion of the Flight Readiness Review, currently expected April 16.

But April 30 has been pencilled in as the date that that it will jet off from Cape Canaveral in Florida, with assistance from Nasa.

Only Russia

Nasa, which ended its shuttle to the ISS in July 2011, now wants to delegate that task to the private sector and has channelled $270m to companies such as SpaceX, Boeing, Sierra Nevada Corporation, and Blue Origin.

In a draft budget submitted to Congress in February, President Barack Obama requested $829m to develop commercial flights to the ISS, partly to end US reliance on Russian craft to deliver astronauts and re-supply the station.

The United States currently has to pay Russia to take its astronauts to the station, where the mission has been extended until 2020, on Soyuz craft.

The latest SpaceX launch should pave the way to more journeys into space for non-astronauts.

John Spencer, president and co-founder of the Space Tourism Society, told AFP that rich businessmen had been crucial in developing commercial interest in space, but costs should eventually drop and make such travel affordable.

“What happened over the last 10 years is half a dozen multi-billionaires from outside the space community entered the space industry,” he said, naming the British entrepreneur Richard Branson.

“We see space tourism and space ports growing over the next several decades into an international industry with tens of thousands of people going off to have a unique space experience,” said Spencer, who has been involved in the industry since it was first conceived in the 1980s.

He likened the situation to that of once rare adventure destinations such as Antarctica, which is now accessible to more humble travellers, and said venturing into space could eventually resemble taking a trip on a cruise ship.

“It’s why those companies in the hotel and cruiseline industry… were paying attention,” he said.

“We are creating visions of space experiences that are compelling and interesting, and which will widen the range of the market.”

Virgin Galactic, owned by Branson, has been selling tickets for a journey into space for $200 000 each and announced that American actor Ashton Kutcher this week became its 500th customer. The company has already taken $60m in sales and deposits.

The prices of the only trips into space so far, which were sold to private individuals travelling on Russian spacecraft, have ranged from $45m to as much as $150m.