Microsoft look set to swing legal battle

Microsoft will be able to avoid drastic changes in the way it does business, as it looks set to emerge from a wrangle with American courts.

The imminent settlement of the U.S. Justice Department's anti-trust case against the software giant will be a boost for Microsoft, analysts said on Thursday.

Precise terms of the deal that eliminates most of Microsoft's legal troubles were still unclear. But analysts said the rumored proposals so far appeared to be much softer than court-imposed remedies issued last year but suspended as the company appealed.

Significantly, the settlement does not appear to take aim at Windows XP, the operating system Microsoft launched last week, which includes an improved music and video player, instant messenger and links to other Microsoft-backed services.