The Future

Wrapping things up, as we mentioned in our introduction this puts to rest one of the final pieces of outstanding litigation for Intel. They have settled with the FTC, they have settled with AMD, and now they have settled with NVIDIA. The only outstanding item is the EU’s fine, which may take a number of additional years to resolve, and in the meantime in light of the FTC settlement it’s hard to believe that Intel will win that battle.

At the end of the day NVIDIA is receiving 1.5 billion dollars, continued rights to make C2D chipsets, and unspecified patent protection for their ARM-based Project Denver CPU. Meanwhile Intel will continue to have access to NVIDIA’s graphics patents enabling them to produce IGPs, and some additional security in the x86 market by continuing to lock NVIDIA out of it. NVIDIA seems to have gotten the better end of the deal here, but Intel certainly got something out of the deal too.

Intel Settlement & Fine Costs
European Union AMD NVIDIA

It’s worth noting that on top of the explicit costs of fighting these legal battles and the implicit costs of cross-licensing, these fights have taken their toll on Intel’s finances. They’re still a highly profitable company, but between the EU fine, the AMD settlement, and now the NVIDIA settlement Intel is on the hook for roughly 4.2 billion dollars. This is roughly the company’s net income for 2009 – or in other words so long as the company is functioning well their settlement costs are only a fraction of their profits over the past decade.

At the same time just because Intel has settled their legal matters doesn’t mean it’s smooth sailing for the chip fab company that has a design addiction. Intel is facing a competitive market in a whole new direction: mobile/SoC. x86 is firmly in their hands, but ARM and future generations of Atom are set to compete in the SoC market, and at the same time NVIDIA’s ARM-based Project Denver could upset the server market in a way not seen in years. Intel has their work cut out for them, and as we’ve seen should they falter there are plenty of other companies waiting to capitalize on the opportunity. Lawsuits, fines, and inquiries may sound scary, but the biggest threat to Intel remains all the other companies that want to take down the 800lb gorilla of the silicon world.

The Settlement


View All Comments

  • james.jwb - Tuesday, January 11, 2011 - link

    what we have because of the lack of third party chipsets is the P67/H67/X58/no Z67 fiasco - high priced boards with less on the boards and a total mess. Reply
  • 7Enigma - Tuesday, January 11, 2011 - link

    I tend to agree with this statement. Had there been other chipset makers at the launch of SNB the enthusiasts would have flocked to the Z67-similar mobo as the current offerings are crap. Reply
  • HangFire - Tuesday, January 11, 2011 - link

    On-chip x86 memory controller patents are owned by AMD, Intel violated those patents with Nehalem, that was the primary thing driving Intel to the bargaining table - paying off AMD to get access to those licenses.

    Intel cannot re-license those AMD patents to Nvidia, so Nvidia remains locked out of the on-chip memory controller x86 market.
  • Stuka87 - Tuesday, January 11, 2011 - link

    Unless I am mistaken, if nVidia got the right to manufacture an x86 chip, any IP owned by AMD would have to be licensed from AMD, and not through Intel. Reply
  • HangFire - Tuesday, January 11, 2011 - link

    Yeah. That's what I just said. Intel cannot relicense AMD technology, so any IP owned by AMD would have to be licensed by Nvidia from directly from AMD, something not likely to happen. Reply
  • ash9 - Tuesday, January 11, 2011 - link

    Imagine a Sandy Bridge without a graphics engine (No next-gen for you-LOL Larrabee??) - Intel got a bargain; spread out over 6 years, is no-thing, I’m sure they would have paid a kings ransom- it would have been their death…Nvidia missed it

  • pugster - Wednesday, January 12, 2011 - link

    Agreed. Intel paying off AMD for its integrated memory controller patents and Nvidia for integrated graphics patents. That's the big difference between a Sandy Bridge and a Core2duo cpu's. Intel says that they are going to have revenues of 13 bil because of Sandy Bridge this year, more than enough to pay off AMD and Nvidia for their IP's. A real bargain for Intel indeed. AMD and Nvidia should've be smart enough and license their technology to Intel and receive $x per every processor intel sells. Reply
  • quanta - Wednesday, January 12, 2011 - link

    It seems no one mentioned the SLI licensing that Intel has paid to NVIDIA prior to the settlement that 'allows' NVIDIA not to cripple SLI support at GeForce/Quadro drivers. That seems to be the only 'NVIDIA technology' that Intel ever gets out of the settlement, if the settlement is really just extending existing cross licensing deals. After all, the Intel HD Graphics has so far been based on PowerVR SGX cores licensed to Intel, it is unlikely for Intel to use new cores that that have incompatible instruction sets, especially now that Sandy Bridge-based CPUs include graphics cores that will get supported (or already supported?) by Intel compilers. Reply
  • tafreire2011 - Thursday, January 13, 2011 - link

    CrossFire support will end on Intel motherboards? Or not? Reply
  • cesthree - Tuesday, January 18, 2011 - link

    "If you ask Intel, NVIDIA’s agreement only covers AGTL+,"

    This was Intel's only mistake, allowing Nvidia to disgrace the AGTL+ with their presence.

    Stick to GPU's Nvidia; nothing past PCIE bus, please.

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