Saturday, July 2 2005 17:52 Hrs (IST) - World Time -

New York: Microsoft agreed to pay $ 775 million to IBM in a settlement stemming from the software giant's antitrust case with the federal Government, the sources said in New York.

Microsoft will also provide a $ 75 million credit toward use of Microsoft software at IBM.

IBM was identified as having been impacted by monopolistic Microsoft practices in the long-running US Government antitrust case that ended with a court-approved settlement in 2002.

"With these antitrust issues behind us, both Microsoft and IBM can move ahead, at times cooperatively and at times competitively, to bring the best products and services to customers," said Brad Smith, general counsel and senior vice president, Microsoft.

The court found Microsoft's practices hurt the IBM OS/2 operating system and SmartSuite software products.

"Over the last few years we have been focused on resolving our disputes with other companies, and today's announcement takes another significant step towards achieving that goal."

"IBM is pleased that we have amicably resolved these long standing issues," said Ed Lineen, senior vice president and general counsel, IBM, in the joint statement.