Microsoft and the US Justice Department have reached a tentative agreement to settle the massive antitrust case against the software giant.
Terms of the prospective settlement are closely guarded, and people close to the negotiations caution that precise language was still being worked out even between Microsoft and the Justice Department.
The attorneys generals from the states that sued the software giant for antitrust violations are weighing whether to sign on to the deal, the sources said.
Mr Charles James, assistant US attorney for antitrust, disclosed the agreement to the attorneys general last night and said Microsoft would also accept the terms, the sources said, speaking only on condition of anonymity.
The computer industry has eagerly been monitoring the talks, looking for a possible settlement and hoping it would combine with the release of Microsoft's new Windows XP operating system to invigorate the lagging industry that has helped drag down the stock market.
The new trial judge, US District Judge Colleen Kollar-Kotelly has set a deadline of tomorrow to reach a settlement.
The sides - including state prosecutors from Iowa, Connecticut, New York and Wisconsin - met late into last night in Washington.
AP