* In a surprising move, Facebook is buying Instagram for $1 billion. Did Instagram’s latest round of funding cause Facebook to panic? More importantly, will the insanely popular photo-sharing app solve the social network’s mobile problems? Also, a brief profile of Instagram founder and CEO Kevin Systrom. (Fortune and The Wall Street Journal)

* Microsoft (MSFT) will pay AOL (AOL) nearly $1 billion to get 800 patents and related patent applications, likely in a bid to keep those patents away from Google (GOOG). (CNET)

* Despite Apple’s (AAPL) ascendant shares, one analyst has shifted his rating from “neutral” to “buy.” (All Things D)

* Why AT&T (T) is spending more on the launch of Nokia’s Lumia 900 handset than it did on the iPhone. Also, the company plans to sell its long-standing Yellow Pages business to Cerberus Capital Management. (Ad Age and CNNMoney)

* PayPal’s Vice President of global product and experience, Sam Shrauger, is leaving the company. His departure comes on the eve of the announcement that Yahoo (YHOO) is restructuring. (All Things D)

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