Microsoft and IBM can be friends again - or at least less bitter partners/rivals after Redmond agreed to hand over an $850m antitrust apology.

Microsoft will pay IBM $775m and dole out a $75m software credit. These gifts stem from Microsoft's antitrust trial in which IBM was deemed to have been unfairly punished by Microsoft's business practices. Critically, Judge Thomas Penfield Jackson found that Microsoft overcharged IBM for software and used unsavory, discriminating pricing tactics.

Microsoft has coughed up more than $3bn to rivals such as Sun Microsystems, AOL and Gateway over various anticompetitive matters. The beef with IBM centered around the OS/2 operating system, SmartSuite productivity software and how Microsoft licensed Windows.

"IBM is pleased that we have amicably resolved these longstanding issues," the company said in a statement.

Now the two vendors can go back to less amicably competing over Java, Unix, and Linux while partnering to sell millions in Windows and Office licenses. ®

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