Google has agreed to pay the Associated Press for use of its news stories and pictures, according to a statement released by the two companies on Wednesday.

The deal settles a dispute between Google and the AP and has implications for a lawsuit Google is facing from the Paris-based Agence France Presse news agency, which sued the search powerhouse last year for allegedly infringing its copyrights on Google News. Agence France Presse, which is seeking $17.5 million in damages, hopes that Google's revelation of payment to another news source for content will add weight to its argument, according to published reports.

Though it wasn't made public until Wednesday, the agreement between AP and Google has been under way for several months.

Financial terms were not disclosed. Consequently, it's unclear whether the deal involves a flat fee or paying AP according to traffic statistics.

Read more: ZDNet