Microsoft is to pay $761m (£436m) to US software rival RealNetworks to end an anti-competition lawsuit over computer music players.
RealNetworks had alleged that Microsoft forced PC makers to fit its rival's Windows Media Player software at the expense of its own Real Player.
Microsoft and RealNetworks said the agreement paved the way for future collaboration between the two firms.
Washington-based Microsoft has been hit by a number of similar lawsuits.
Back in July, it paid IBM $775m to settle a case.
It had earlier reached anti-competition agreements with the US government, and fellow companies Time Warner and Sun Microsystems.
A dispute with the European Union (EU) remains.
"Today we're closing one chapter and opening a new one in our relationship with Microsoft," said RealNetworks' founder and chief executive Rob Glaser.
"The legal chapter is being closed with an appropriate and fair outcome that sets the stage for a very productive and collaborative relationship between our companies."
In addition to the $761m, RealNetworks now gets long-term access to Microsoft technologies that will enhance its Real Player software.
Microsoft has also agreed to promote RealNetworks' music and games subscription service through its MSN internet network.
Back in March 2004, the EU fined Microsoft $597m for anti-competition practices.
It also ordered the computer giant to share its computer codes with rivals and offer stripped down versions of its Windows software.
Microsoft is continuing to appeal certain aspects of the EU's finding, and EU spokesman Jonathan Todd said on Tuesday that the computer firm's agreement with RealNetworks would have no affect on the ongoing legal case.
"We will continue to ensure full and complete compliance with the March 2004 decision," he said.