Intel, the semiconductor maker, has formed an Internet multimedia technology and marketing partnership with RealNetworks, a specialist software group, to create technology for the production of Internet video and television, in competition with Microsoft.

The move comes shortly after the US Justice Department alleged that Microsoft had attempted to bully Intel, RealNetworks and other companies, into not competing with it in Internet multimedia. However, this week's announcement suggests that, if such bullying occurred, it had no lasting impact.

The joint announcement with Intel gave RealNetwork's share price a strong boost, recovering some of its losses over the past two months since the company became embroiled in the Microsoft antitrust lawsuit.

Intel, the leading personal computer chip-maker, is pursuing Internet video technologies to create broader consumer demand for high performance PCs.

The new technology promises better sound quality and clearer pictures for video transmitted over the Internet.