Software Maker Venture Avoids EU Probe

Microsoft Corp. and Time Warner Inc. went ahead with a venture to buy ContentGuard Inc., a U.S. maker of anti-piracy software for Internet music and film distribution, after bringing in Thomson to sidestep a European probe.

The European Commission has been investigating a plan by Microsoft and Time Warner to buy ContentGuard. Bringing Thomson into the venture means no company will have control and the deal is no longer subject to EU merger rules, the commission said.

Microsoft, Time Warner and Thomson, the No. 1 manufacturer of television set-top boxes, aim to use ContentGuard’s software to set an industry standard for so-called digital rights management, the basis for legal download services such as Apple Computer Inc.’s iTunes.

Redmond, Wash.-based Microsoft and New York-based Time Warner agreed to buy Xerox Corp.’s stake in ContentGuard last March.