Microsoft settles InterTrust suit for $440 million

Microsoft plans to announce Monday that it has reached a $440 million legal settlement and licensing deal with the InterTrust Technologies, a private company and a pioneer in the development of software to protect digital music and movies from piracy.

The settlement of InterTrust’s patent infringement suit, filed in 2001, is the latest in Microsoft’s continuing drive to resolve its legal disputes. It comes less than two weeks after the company, the world’s largest software maker, agreed to pay Sun Microsystems $1.6 billion to settle Sun’s private antitrust suit against Microsoft and to resolve patent claims.

The InterTrust settlement removes a threat to Microsoft’s ability to deliver piracy protection technology in its software products for playing and handling digital media. The technology for so-called digital rights management, analysts say, is crucial for Microsoft’s plans to extend its Windows software into the emerging market for legally distributing music and movies over the Internet, in competition with rivals like Apple Computer, RealNetworks, Sony and others.

Last week, Microsoft and Time Warner announced that they had acquired a majority stake in another developer of digital rights management technology, ContentGuard, a small company spun out of the Xerox Palo Alto Research Center. The terms of the purchase were not disclosed.

Now I know why MS software are expensive!

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