Ending its last major private antitrust case, Microsoft will pay $761 million to settle a lawsuit with RealNetworks and created a multipronged partnership to collaborate in digital entertainment.

Under the deal, Microsoft will pay cash or the equivalent in free marketing services to Seattle-based RealNetworks, which will end its antitrust litigation on a global basis and support Microsoft with music services that will help the Redmond, Wash., software giant compete with rivals such as Google.

Microsoft Chairman Bill Gates, above, and RealNetworks Chief Executive Officer Rob Glaser announced the settlement Tuesday and said the deal would lead to more choice for consumers on how to access digital entertainment.

Both said they needed to make their products work together to take advantage of the explosion of digital music, with the unsaid subtext that rivals are doing a better job exploiting demand from consumers.