In a major turnaround of policy, the world's largest software maker said it would comply with the EU's 2004 antitrust ruling that said Microsoft was abusing its dominant market position to crush rivals.

That will include making available to open-source software developers information they need so that their programs work smoothly with Microsoft Window's operating system for personal computers. In addition, Microsoft will also reduce high royalties it requires from open source software developers for open source software developers to a nominal one-time payment of 10,000 euros, the EU Commission said.

Office desktop PCs use work group server software made by Microsoft and others to sign on to, print and access files.

"A victory for the consumer"

EU Competition Commissioner Neelie Kroes called the news a "victory for the consumer," saying Microsoft was finally taking concrete steps to comply with the 2004 ruling after several delays, two court decisions and daily penalty payments.

Kroes said Microsoft CEO Steve Ballmer had assured her in a telephone conversation the company would fulfill all the conditions attached to the antitrust ruling.

"The repercussions of these changes will start now and will continue for years to come," Kroes told a news conference, adding that Microsoft's agreement would have "profound effects" on the software industry.

Last month, the European Court of First Instance confirmed the EU's 2004 antitrust finding that the world's largest software maker had used its dominant market position to crush rivals. It also backed the commission's imposition of a record fine of 497 million euros ($690 million).

A Microsoft spokesman told the AFP news agency that the company would no longer appeal the court decision, signaling the end of a long court battle.

Microsoft said its discussions with the commission were constructive and it "will continue to work closely with the commission and the industry to ensure a flourishing and competitive environment for information technology."

The end of a legal saga

The case dates back to March 2004 when the commission ruled after a five-year probe that Microsoft was using its 95-percent share of the desktop computer market to bundle other products with the ubiquitous Windows operating system.

The commission ordered the US-based multinational corporation to sell a version of their flagship Windows operating system without a media player and to share technical information with competitors so that they could more easily create Windows-compatible programs.

Brussels fined Microsoft a further 280 million euros in July last year after it emerged the company had not respected its original ruling.