Facebook received a patent for streaming social network news feed technology, raising questions over how the company will wield this new power.
Having the patent means Facebook could potentially do battle with any other social networking site that uses news feed technology. Analysts say Facebook could use the patent as leverage with rival sites, forcing competitors, for example, to license the technology or stop using it.
For now, Facebook's rivals will have to wait and see.
"Assuming good execution, this could be a gold mine," said Rob Enderle, an analyst with the Enderle Group. "Facebook has the potential to gain the kind of power that Microsoft and Google enjoy. They have a long and dangerous path to get there, but with this, they are getting closer to that potential ... This is one of those events that can truly define an emerging company and change it from an interesting niche player to a major industry power."
A news feed is a format used to provide users with real-time updated content. Facebook users, for instance, receive a feed filled with the updates, photos and videos posted by people they have "friended." The feed on microblogging site Twitter is a constantly updated list of tweets from people the user is following.
News feeds are the bread and butter of most, if not all, social networking sites. It's a way for people to stay up-to-date with friends, colleagues and family - the backbone of social networking.
The patent has been in the works for a long time. Facebook applied for the patent in 2006, before the site Twitter even came into being.
Ezra Gottheil, an analyst with Technology Business Research, said with this patent now in hand, Facebook may be able to legally pursue rivals that are using this news feed technology. The company could push for its rivals to stop using the technology or to buy a license from Facebook to continue using it.
A lot will depend on the specific wording of the technology in the patent and how closely it resembles the technology that other sites are using.
"The launch of News Feed in 2006 was a pivotal moment in Facebook's history and changed the way millions of people consumed and discovered information on the site," said Brandee Barker, a Facebook spokesperson in an e-mail to Computerworld . "We're humbled by the growth and adoption of News Feed over time and pleased with being awarded the patent."
Barker declined to comment on what Facebook will do now that it has the patent.
Karsten Weide, an analyst with IDC, said the patent could affect a lot of companies, including Twitter, Yahoo and Google with its new Buzz social hub. All of them depend on streaming feeds.
"The devil is in the details," Weide said. "Everything depends on what exactly the patent covers, whether Facebook is interested in enforcing a competitive advantage or licensing fees, how enforceable it actually is, and how much resistance the others would put up. Most likely Facebook will use it as a bargaining chip in various partnership negotiations."
He added that forcing companies to stop using the functionality or to pay licensing fees might be more than Facebook wants to bite off.
"It would be unwise to act heavy handedly with partners," Weide said. "It would create a lot of bad blood in the industry and bad PR. But then, Facebook's attention to PR consequences has been lacking at times."
Enderle said this could be a game-changer for Facebook. Now it's just a matter of waiting to see what the company does with its new patent.