Microsoft pays up again

Less than two weeks after shelling out nearly $2 billion to arch-rival Sun Microsystems Inc., Microsoft Corp. whipped out its checkbook again to settle ongoing litigation.

The Redmond, Wash.-based software giant agreed to pay $440 million to Santa Clara, Calif.-based InterTrust Technologies Corp. to license the company's digital rights management technology. The agreement also settles a three-year legal dispute in which InterTrust claimed Microsoft had infringed on its patents.

Digital rights management technology provides the foundation for protecting online content in trusted computing environments. It is seen as essential to preventing pirated media from being shared online without permission.

"Today's announcement validates InterTrust's intellectual property portfolio as seminal to advancing DRM and trusted computing in the marketplace," said Talal Shamoon, chief executive officer of InterTrust.

The settlement ensures that Microsoft's end user customers can use its products and services without requiring a license from InterTrust. In addition, software developers who build products using Microsoft technology will not need an InterTrust license under normal circumstances.

However, according to InterTrust officials, systems integrators may need a license from InterTrust for other uses of Microsoft technology, including cases in which Microsoft technology is combined with third-party technology.

Analysts were quick to point out that there is still no standard for digital rights management, but Microsoft pledged to make the technology a core part of the next version of Windows, codenamed Longhorn and due out in 2006.