Meta was ordered to pay Voxer, the developer of the walkie-talkie messaging app, a $175 million fine. A jury in a Texas federal court found the social media giant infringed on two live-streaming patents. Meta infringes the patent on Facebook Live and Instagram Live. The patents were developed by Voxer co-founder Tom Katis, a US Army veteran. The Katis team was ambushed in Kunar province in 2003. He developed the technology while also fixing deficiencies in battlefield communications after the ambush.
Katis and the team started developing communication solutions in 2006. This led to new technologies capable of transmitting real-time voice and video communications. Voxer was founded in 2007 and the Walkie-Talkie app launched in 2011.
Meta is appealing Voxer’s fine decision
Court documents claim that Meta, then known as Facebook, partnered with Voxer. This happened shortly after the app’s launch in hopes of partnering with the app. By February 2012, Voxer Meta had disclosed its patent portfolio and proprietary technology. However, both companies did not reach an agreement. Ironically, Meta tagged Voxer as a competitor. This is suspicious as Facebook didn’t have any live video or voice products of its own at the time. Meta subsequently revoked Voxer’s access to key components of the Facebook platform. Facebook then launched Facebook Live in 2015 and Instagram Live in 2016.
Katis and a senior product manager from Facebook met on Facebook Live in 2016. Katis claims he led the patent infringement discussion with the manager. However, Meta did not want a settlement with Voxer. Interestingly, it continues to use Voxer’s technology to its advantage.
The unanimous jury verdict in this case awards Voxer a total of $174,530,785. Meta must pay the sum through ongoing license fees. Meta won’t back down so easily, however, with the company saying it will appeal the decision.
“We believe the evidence at the trial indicates that Meta did not infringe Voxer’s patents,” a company spokesman replied. “We intend to seek further discharge, including an appeal.”
Meta to reduce the cost by 10%
Over the next few months, Meta will reduce costs by 10% or more. As part of the operational restructuring, which is also part of the cost-cutting measures, some jobs will be cut. The company’s second-quarter earnings report, released in July, showed that the company’s expenses rose 22% year over year to total $20.4 billion. To fuel growth, the company has invested heavily in Metaverse, but nothing has returned so far. Additionally, revenue in the second quarter was down year-over-year, and Meta expects a decline in the third quarter as well.
Meta’s chief product officer, Chris Cox, has told employees the company is going through a difficult time with strong headwinds. Cox also said teams shouldn’t expect a ton of new hires and bigger budgets as the company seeks better execution in a slowing growth environment. Meta stocks are down 56% so far this year, while the S&P 500 is down less than 20%. On the Nasdaq, it’s down about 26%.