Microsoft and Real Networks have settled their legal disputes, at least for a little while, thanks to a $761 million dollar global antitrust settlement which has several cross promotional benefits for both companies:

-MSN Messenger users will be able to share and play music while chatting, from the library of over 1 million songs in Rhapsody, in a convenient and legal way;
- MSN Search will use Rhapsody’s critically acclaimed music editorial catalogue to help users find the music they love and to discover new artists;
- The two companies will jointly develop and implement a search integration plan which will enable Real’s customers to easily use MSN Search within RealPlayer;
- MSN Search will feature Rhapsody links to music in music related search results;
- The agreement enables Real to purchase advertising on MSN Search and on the MSN Network to promote Rhapsody;
- Both companies will promote the use of Windows Media portable devices for use with Rhapsody to Go.

This deal will keep Real from succumbing to the water in its financial lungs, so it’s more help for Real than for Microsoft, but together these two forces form an alliance which could pierce the armor of iTunes. I say could with great reservation, but competition like this generally speaking is good for the consumer.

Stock market reaction to these decisions? Real Networks (RNWK) was up $1.96 (+34.15%) and Microsoft (MSFT) was down 5 cents a share on the day (-$0.20%). So good for Real, no real change for Microsoft. Isn’t that something? Microsoft reaches a settlement for three quarters of a billion dollars and their stock hardly hiccups.

Over the long term, I think this will be good for Microsoft stock because they can put all this negative antitrust stuff with Real behind them (hopefully) and combine forces to compete against Apple.

I do not currently own either Microsoft or Real stock, but I do own Apple (AAPL) stock (today activity pictured above). In fact, I bought more Apple stock today despite the 10% loss in share price over the 4Q revenue predictions falling short. Why? Their actual revenue more than quadrupled over what they did in the previous year’s quarter and I still haven’t seen a white iPod Nano in any store. I’ve seen the black ones but the white ones seem to be sold out around here. The iPod is their horse and I believe their stallion is not done riding, especially if/when they start running out video.

Did this post make you go hmm?

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