Microsoft pays $750m to end browser battle

AOL had alleged that Microsoft abused its desktop near-monopoly to promote Internet Explorer and try and kill off AOL's rival Netscape browser.

The two industry giants have clashed over a number of internet technolgies in the last three years, but the agreed settlement will see more co-operation in the future.

Part of the settlement sees Microsoft provide a royalty-free, seven-year license to use its Internet Explorer technologies with the AOL client.

Additionally there has been a commitment by Microsoft to make available technical information contained in test or 'beta' versions of its Windows operating system to AOL at the same time that its makes them available to other independent software vendors.

Microsoft must also ensure that AOL can participate in other programmatic offerings relating to the development of Microsoft's next-generation 'Longhorn' version of Windows on the same terms and at the same time as other independent software vendors.

In addition the two companies have entered into a long-term, non-exclusive licence agreement allowing AOL Time to use, if it so chooses, Microsoft's Windows Media 9 Series digital media platform, as well as subesquent Microsoft digital rights management software.

The two companies have also agreed to explore ways to establish interoperability between AOL and MSN Instant Messenger.

'We welcome the opportunity to build a more productive relationship with Microsoft,' said Dick parsons, chairman and chief executive at AOL Time Warner, in a statement. 'Our agreement to work together on digital media initiatives marks an important step forward.'

'We believe we can accelerate the adoption of digital media for the internet and help content providers across the entire industry,' said Bill Gates, Microsoft chairman and chief software architect, in a statement.

'While our companies will continue to compete, I'm pleased that we've been able to resolve our prior dispute,' he added.