Casio has agreed to pay royalties to Microsoft in exchange for Redmond's pledge not to sue the Japanese electronics manufacturer for using Linux code in its products. The deal makes Casio the latest in a growing list of companies that are paying to use what is ostensibly open source software, rather than risk a lengthy and expensive legal fight with Microsoft.

Under the multi-year deal, Microsoft also agreed not to pursue legal action against Casio's customers. Casio is most known for consumer devices such as watches and calculators, but it also makes business systems, including industrial handheld terminals, that incorporate a mix of Microsoft and Linux technologies.