The online retailer has paid IBM an undisclosed amount of money to settle a patent dispute that goes back to 2002 when IBM first approached Amazon about a licensing deal, but it wasn’t until October 2006 that IBM sued Amazon alleging key components of Amazon's website were developed and patented by IBM to which Amazon responded with a countersue two months later accusing IBM of violating five separate Amazon patents.

Amazon said the settlement would not affect the firm's second-quarter results, adding that the payout to IBM had been factored into its financial guidance for the forthcoming three-month period.
Dan Cerutti, IBM's general manager of software intellectual property, said he was pleased that the matter had been "resolved through negotiation and licensing".

The settlement brings a long-term patent cross-license agreement between the two companies and gives Amazon access to IBM's patents on Web technology, while IBM for its part looked forward to a more productive relationship between the two companies.