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Intel, AMD kiss and make up

Intel and AMD have been involved in long-standing dispute over intellectual property and antitrust issues. Intel was fined $1.45B by the EU for its anticompetitive practices and last week, New York Attorney General Andrew Cuomo filed an antitrust lawsuit against Intel.

Cuomo had rather harsh words for Intel, stating, “Rather than compete fairly, Intel used bribery and coercion to maintain a stranglehold on the market. Intel’s actions not only unfairly restricted potential competitors, but also hurt average consumers who were robbed of better products and lower prices.”

However, Intel and AMD now appear to be making amends. The pair issued a joint statement today which reads, “While the relationship between the two companies has been difficult in the past, this agreement ends the legal disputes and enables the companies to focus all of our efforts on product innovation and development.”

As a part of the settlement, Intel will pay AMD $1.25 billion, AMD will drop all of its pending lawsuits against Intel, and the pair will enter into a new 5-year cross license agreement. In addition, Intel will "abide by a set of business practice provisions" in the future.

AMD CEO Dirk Meyer today championed the agreement, stating, "Today, I am pleased to announce the last major component of that transformation – in the form of a transparent and public agreement with Intel to create a level playing field in the x86 processor industry – taking us one big step closer to achieving our bold vision."

Meyer continued, adding, "Today marks the beginning of a new era... one that confirms that the game has changed for AMD. It is an important milestone for us, for our customers, our partners, and most important – for consumers and businesses worldwide. In addition, it represents the culmination many years of litigation and regulatory engagement."

Following the announcement, AMD shares are up 25 percent to $6.61 while Intel is up almost a percentage point to $20.05 as of 10:00 AM EST.

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Didn't see this one coming....
By weskurtz0081 on 11/12/2009 9:49:13 AM , Rating: 2
Clearly Intel knew this one was going to be a losing battle, and AMD probably didn't want to drag it out any longer for financial reasons. But, the outcome seems fair I guess.

RE: Didn't see this one coming....
By ksherman on 11/12/2009 9:54:55 AM , Rating: 3
Plus it gives AMD an infusion to survive 2010 until their new architecture hits in 2011. Though that means Intel will likely be somewhat stagnant for 2010. Gonna be a boring year ;-)

RE: Didn't see this one coming....
By Master Kenobi on 11/12/2009 12:30:49 PM , Rating: 3
1.25B is a drop in the bucket for Intel. Their R&D yearly is somewhere in the 3-4B range.

RE: Didn't see this one coming....
By 3minence on 11/12/2009 1:20:26 PM , Rating: 2
Didn't Intel Object to AMD spinning the Fabs off? Didn't they say it was a violation of their licensing agreement because they were no longer owned by AMD? I bet that case is now also dropped as part of this deal. A protracted legal battle was bad for everyone with nobody winning (except the lawyers). Assuming Intel's objection to spinning the Fabs off is also dropped, this is a good deal for everyone.

By weskurtz0081 on 11/12/2009 2:20:18 PM , Rating: 2
Yes, all current and pending legal battles between the two companies were dropped.

"We can't expect users to use common sense. That would eliminate the need for all sorts of legislation, committees, oversight and lawyers." -- Christopher Jennings
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