Microsoft Pays Netscape $750 Million to Settle Antitrust Suit

Thursday May 29th, 2003

Several people wrote in to tell us that Microsoft has agreed to settle the private antitrust suit filed against it by Netscape Communications Corporation last year. Microsoft will pay AOL Time Warner, Netscape's parent company, $750 million to end the litigation. In a related agreement, Microsoft will give AOL a seven-year royalty-free license to use Internet Explorer and a long-term license to use its Windows Media 9 Series technology. The two giants have also agreed to work together on digital media initiatives and establish interoperability between the AOL Instant Messenger and MSN/Windows Messenger networks. In addition, Microsoft will give AOL more technical information about Windows and help AOL to distribute its software to some PC vendors.

CNN/Money, CNET and all have articles about the settlement. More details are available in Microsoft and AOL Time Warner's joint press release.

Update! Further reports are available from Slashdot, MSNBC, PC Magazine, InfoWorld, InternetNews, ENT News, EE Times and the Associated Press (via InformationWeek). Meanwhile, CNET asks if the IE licensing deal means the end of Netscape.

Another Update! CNET now has an entire special coverage section on the deal, which includes a longer updated main article. The report has also been revised and other stories can be found at Wired News, BetaNews and Reuters.

Another Update! Microsoft's PressPass site has a transcript of a press conference call with Microsoft's Bill Gates and AOL Time Warner's Richard Parsons, which has been extensively referred to by many media reports. A collection of soundbites from Bill Gates is also available.

Another Update! Matt Kraai writes: "Salon is carrying an article on the Microsoft/AOL TW settlement and its effect on Mozilla. I found it via Boing Boing." To read the article, you'll either have to subscribe to Salon Premium or view a short ad, which will give you access to Salon for the day.

#44 Too many people are seeing this the wrong way....

by MarkHB

Friday May 30th, 2003 8:20 AM

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It seems like many of the comments on this topic are forgetting the most important thing about AOL these days: the fact that they are AOL Time Warner. SmileyBen said "We all have the power to make it so that AOL simply cannot afford to keep using IE in light of Gecko's superiority", but AOL-TW is not a technology company. No matter how good the Gecko renderer is, IE and WMP offer something Gecko never can: a built-in distribution network for TW content via MSN's channels, right there with every new XP install. MSN is no longer an important competitor to AOL, as they now share a common threat: raw Internet access, which is devouring the market share of both major online services as US connectivity growth slows and mature users lose the training wheels. To the folks at Rockefeller Plaza, MS is a business partner; a real competitor is Viacom (CBS).