hit in mid-2009 with a massive $1.45B USD fine by the European Union
for alleged anticompetitive practices. As it faced similar scrutiny from
Federal Trade Commission, Intel rushed to settle with AMD, one of the firms
suing it in civil court and funneling evidence to FTC investigators. In
the end Intel had to pay
$1.25B USD to its CPU and graphics rival to put that legal mess behind
Now it has paid a cool $1.5B USD [NVIDIA
press release] to make sure an ongoing civil suit with NVIDIA doesn't
land it in any more trouble. The cash will be paid over a five-year
period. All pending claims will be dropped by both companies, which have
engaged in numerous suits and countersuits.
The move also puts into place a cross-licensing agreement, which includes
everything except "Intel's proprietary processors, flash memory and
certain chipsets for the Intel platform". The likely result of this
will be Intel and NVIDIA finally setting aside their differences and merging
their strongest products -- Intel's CPU cores and NVIDIA's GPU cores.
This is seen by many as a necessary move as AMD rushes to bring its own CPU/GPU
system-on-a-chip offerings to market, the fruition of its 2006 acquisition of
graphics chipmaker ATI.
NVIDIA President and CEO Jen-Hsun Huang, who once promised to open his
"can of whoop ass" on Intel, states in his company's press
release, "This agreement signals a new era for NVIDIA. Our cross
license with Intel reflects the substantial value of our visual and parallel
computing technologies. It also underscores the importance of our inventions to
the future of personal computing, as well as the expanding markets for mobile
and cloud computing."
Doug Melamed, Intel senior vice president and general counsel adds [Intel
press release], "This agreement ends the legal dispute between the
companies, preserves patent peace and provides protections that allow for
continued freedom in product design. It also enables the companies to
focus their efforts on innovation and the development of new, innovative
The move also seemed necessary, as the company needs to be on good terms with
the FTC. While it recently scored approval of
a major acquisition of the world's largest antivirus software maker, McAfee, it
will likely need the FTC's support on many items in the future.
Intel now appears to have a mostly clear slate. It has settled with the
EU, it has settled with the FTC, and it has settled with its two biggest
rivals. All that bodes pretty well for the world's largest CPU maker,
despite the hefty size of the collective settlements (approximately $4.2B USD).
quote: Always buy stock when its down
quote: Not buying nVidia stock back in August 2010...
quote: The likely result of this will be Intel and NVIDIA finally setting aside their differences and merging their strongest products -- Intel's CPU cores and NVIDIA's GPU cores