RealNetworks, which publishes software that plays videos and music on computers, is to provide the default player for a new range of computers.

RealNetworks' deal, with Texas-based Compaq, is being seen as a victory for the company over its main rival, Microsoft - whose Windows operating system runs on about 90% of the world's computers.

It follows the revision by Microsoft of its software licensing agreements with computer maufacturers after its battles with US anti-monopoly lawyers.

Compaq's Presario line of computers is due to go on sale in March next year.

Finance

RealNetworks is already the default player on computers made by Dell and Gateway.

This deal marks a step forward for the company because it will be able to draw PC users towards its video and audio subscription services, which give access to sports, music and other content for a monthly fee.

To entice users, a video welcoming them to the system will run on the software and a special entertainment key will send them to RealNetworks' content site, chief executive Larry Jacobson said.

It is not known how the deal will be financed, but Jacobson said Compaq and RealNetworks would share revenue from content subscriptions.

"This is not just about software - it's about letting people know that there's content out there," he said.

A Compaq spokeswoman said she did not believe the deal would adversely affect her company's relationship with Microsoft, which provides the operating system on most of its computers.