Microsoft and IBM in a settlement worth USD 850 million

Microsoft and IBM in a settlement worth USD 850 million

Microsoft has agreed to pay $775 million and extend a $75 million credit for Microsoft software to International Business Machines (IBM) to resolve the long standing claims from the old United States v. Microsoft antitrust case between the companies. This means that IBM won’t be asserting claims for server monetary damages for two years and will not seek to recover damages on such claims incurred prior to June 30, 2002.

Microsoft also dropped their own case of antitrust against the IBM Company. The deal takes into consideration the discriminatory pricing and overcharge claims IBM made in the mid-1990s as part of the antitrust case. It also addresses the IBM OS/2 operating system and SmartSuite products issues. There are exceptions to claims for harm to IBM’s server hardware and server software businesses.

This agreement is an expansion of an earlier settlement between these two major tech giants which was due to expire this month. Both the companies are major competitors in some of the major markets in the technology field. However, they are also working together in standards groups to facilitate the creation of Web services and other protocols that will ensure more efficient transactions over the Internet.

The news comes weeks after Microsoft settled their differences with another old foe Sun Microsystems.