Apple and Microsoft have agreed to drop their court battle over patents. The companies will now enter into a peace treaty in which they can give each other permission to use patented technologies without fear of legal action.
Google and Microsoft have agreed to put an end to the patent wars. The companies will now share patents they own that are related to search, advertising, and app distribution.
6th of August, 1997
Steve Jobs announces a five-year partnership between Apple and Microsoft at the Macworld Expo in Boston. During the introduction, Bill Gates famously makes his scary “big brother” appearance on the huge presentation screen. Microsoft agreed to continue developing Microsoft Office for Mac for the next five years, Apple agreed to make Internet Explorer the default web browser on the Mac, Apple and Microsoft agreed to collaborate on Java compatibility, and Microsoft invested $150 million in Apple stock as part of the agreement. The most significant aspect of the agreement is that over the next five years, both firms would cross-license all current patents as well as any new patents, Apple will withdraw their long-running series of patent-infringement litigation against Microsoft, and Microsoft will pay Apple an undisclosed sum.
In the computer world, it’s widely assumed that Microsoft’s $150 million investment in Apple rescued the firm. However, given Apple’s financial position of $1.2 billion at the time, $150 million was a very modest amount of money. Some people now think that the unknown sum of money paid by Microsoft to Apple was a covert settlement to the patent-infringement allegations. This was the actual heart of the “cross-licensing” deal, estimated to be worth anything between $500 million and $2 billion. This considerably greater secret sum, along with the assurance that Apple would be around for at least another five years, provided Apple and Steve Jobs with the breathing space they needed to transform Apple into the world’s most valuable business.
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