Intel to pay Nvidia $1.5 billion in licensing fees

By on January 10, 2011, 3:42 PM
Nvidia has announced that it has signed a new six-year cross-licensing agreement with Intel. Beginning on January 18, 2011, Intel will pay Nvidia an aggregate of $1.5 billion in licensing fees for the future use of Nvidia's technology. The new agreement has been made in time before the last one expires on March 31, 2011.

Under the new agreement, Intel will have continued access to Nvidia's full range of patents. In return, Nvidia will receive an aggregate of $1.5 billion in licensing fees, to be paid in annual installments, and retain use of Intel's patents, which excludes Intel's proprietary processors, flash memory, and certain chipsets for the Intel platform.

This is the formal result of a settlement between the two hardware giants: Nvidia and Intel have agreed to drop all outstanding legal disputes between them. This may not be as significant as AMD buying ATI, but it does mean the two companies will be much stronger going forward into 2011.

"This agreement signals a new era for Nvidia," Jen-Hsun Huang, Nvidia's president and chief executive officer, said in a statement. "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."





User Comments: 22

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CamaroMullet said:

Intel should just buy Nvidia...

They're like a dysfunctional couple. They have the fighting, the break ups, getting backing togethers, just get married already geeeezzz.

Mizzou Mizzou said:

Nvidia must have driven a hard bargain, AMD only got 1.25 billion in their settlement from Intel.

Sarcasm Sarcasm said:

Interesting, whatever they're doing they're going to steamroll their performance lead over AMD.

*sigh* AMD is the underdog in this situation, but how long can they last with budget performance CPUs and GPUs.

Staff
Jesse Jesse said:

Mizzou said:

Nvidia must have driven a hard bargain, AMD only got 1.25 billion in their settlement from Intel.

This isn't a settlement, its a strategic move to allow the two companies to share technology.

Mizzou Mizzou said:

Interesting, whatever they're doing they're going to steamroll their performance lead over AMD.

*sigh* AMD is the underdog in this situation, but how long can they last with budget performance CPUs and GPUs.

Hard to say how much longer AMD can play the budget game, especially with Sandy Bridge coming in at very competitive prices. If Bulldozer doesn't deliver ... AMD may be in for some hard times down the road.

@presmatics - This text is from the article

This is the formal result of a settlement between the two hardware giants: Nvidia and Intel have agreed to drop all outstanding legal disputes between them.

CamaroMullet said:

@Mizzou

I hear ya, my last 3 personal builds have been AMD. I just ordered a Sandybridge mobo and proc, I felt bad at first, but looking at some of the reviews it's hard not to swing back to Intel. I doubt bulldozer will be able to compete honestly.

Sarcasm Sarcasm said:

CamaroMullet said:

I doubt bulldozer will be able to compete honestly.

I agree. I think people are pinning hope on Bulldozer, but I really don't expect much out of it either. If anything, it could just end up being another budget integrated chip for budget notebooks or something.

I got that same feeling when Nvidia released the GTX 580, and the general consensus around the internet was "but but but let's wait for the 6970!!!" And when it came out, there's a whole mixed bag of opinions. Opinions like "oh well... it was aimed at the GTX 570!!!" or "but the performance in some extreme cases at 2560x1200 resolutions it's almost on par with a GTX 580!!!" and now it's but but but the 6990!

I hope AMD proves people wrong this time though with their new CPUs. Otherwise, it looks like I'm going the Intel/Nvidia route the next time I build another computer again.

princeton princeton said:

CamaroMullet said:

@Mizzou

I hear ya, my last 3 personal builds have been AMD. I just ordered a Sandybridge mobo and proc, I felt bad at first, but looking at some of the reviews it's hard not to swing back to Intel. I doubt bulldozer will be able to compete honestly.

Unless AMD hired macgyver to make high end cpus out of paperclips and string then bulldozer won't be competing well :P

Guest said:

Maybe bulldozer will be great since they own ati technology before intel made this agreement with nvidia.

princeton princeton said:

Guest said:

Maybe bulldozer will be great since they own ati technology before intel made this agreement with nvidia.

They've owned ati since the C2D days. And have been behind ever since. This won't be any different man.

CamaroMullet said:

Unless AMD hired macgyver to make high end cpus out of paperclips and string then bulldozer won't be competing well :P

hahaha, exactly.

Wagan8r Wagan8r said:

sarcasm said:

I hope AMD proves people wrong this time though with their new CPUs. Otherwise, it looks like I'm going the Intel/Nvidia route the next time I build another computer again.

Hopefully, the next time I build a computer, it will just be an NVIDIA Denver computer with Windows 8 ARM version. That is, providing I don't build an HTPC first!

dividebyzero dividebyzero, trainee n00b, said:

Nvidia must have driven a hard bargain, AMD only got 1.25 billion in their settlement from Intel.

AMD got "only" $1.25bn because they were (and still are) haemorraging red ink like a haemophiliac piñata due to the ATI acquistion. AMD needed funds desperately, and more to the point, Intel knew that AMD needed funds desperately.

Nvidia carries no debt and is a pretty healthy company as far the companys books go, so no reason to accept a quick/small settlement.

Nvidia (read Jen Hsun Huang) also has the reputation for a single-minded determination in achieving it's goals. If there was a chance in hell that Intel would be found guilty in the suit, then it becomes "practical" to settle given Intel's past run-ins with the courts. Bearing in mind that Intel's earnings for the last quarter amounted to $US2.95bn from $US11bn revenue I can't see Paul Otellini being reduced to eating Hamburger Helper any time soon.

Guest said:

Intel has always sold an inferior overpriced product.

Users just don't want to admit that their systems are not . . . THAT great.

Nvidia has already spoiled us with their GPU failures and poor drivers.

So maybe fan boys should wake up and smell the roses.

dividebyzero dividebyzero, trainee n00b, said:

Ah, The Guest account.

Keeping logical thought processes at bay one post at a time.

CamaroMullet said:

Guest said:

Intel has always sold an inferior overpriced product.

Users just don't want to admit that their systems are not . . . THAT great.

Nvidia has already spoiled us with their GPU failures and poor drivers.

So maybe fan boys should wake up and smell the roses.

Ahhhh, so I'm guessing you are one of those ATI/AMD "fan boys"?

Mizzou Mizzou said:

AMD got "only" $1.25bn because they were (and still are) haemorraging red ink like a haemophiliac piñata due to the ATI acquistion. AMD needed funds desperately, and more to the point, Intel knew that AMD needed funds desperately.

Nvidia carries no debt and is a pretty healthy company as far the companys books go, so no reason to accept a quick/small settlement.

Nvidia (read Jen Hsun Huang) also has the reputation for a single-minded determination in achieving it's goals. If there was a chance in hell that Intel would be found guilty in the suit, then it becomes "practical" to settle given Intel's past run-ins with the courts. Bearing in mind that Intel's earnings for the last quarter amounted to $US2.95bn from $US11bn revenue I can't see Paul Otellini being reduced to eating Hamburger Helper any time soon.

All valid points, but in the end it's simply Intel doing what is best for Intel which is smart business. There's a good read on this over on AnandTech: [link]

princeton princeton said:

dividebyzero said:

Ah, The Guest account.

Keeping logical thought processes at bay one post at a time.

Guest accounts should be removed. There's a reason sites like facepunch have less trolls. It's because people can't hide behind anonymity.

princeton princeton said:

Guest said:

Intel has always sold an inferior overpriced product.

Users just don't want to admit that their systems are not . . . THAT great.

Nvidia has already spoiled us with their GPU failures and poor drivers.

So maybe fan boys should wake up and smell the roses.

You trolls need to try harder. You're obviously a fanboy though so maybe you're unintentionally trolling. LGA 1156 and LGA 1155 both have had better price-performance since release. The i5-750/760 destroys anything AMD makes for only $20-30 more and uses much less power.

The i5-2500K matches or outperforms the intel 975 EE. And the 975 is already 2-3x faster than anything AMD has. And the 2500K is still only $200.

P,S Nvidia does, has, and always will have better drivers than ati.

In conclusion... http://img88.imageshack.us/img88/3263/youamd.jpg

Guest said:

Ripping on guest posts always makes me smile... a better way to get rid of trolls is to allow readers to downgrade posts to the point they are removed with enough negative marks. Princeton, Facepunch doesn't have "less" trolls, they have 'fewer' trolls. If you can quantify it individually you use the word 'fewer'. Like "Guest posters have fewer valid points"

Anyway... my question about Intel is, why are the new Sandy Bridge processors priced so low? They appear to be good enough to be priced a bit higher to the point that Intel is cannabilizing their own markets. Are they trying to drive out AMD for good? Head off any less (haha see!) expensive Bulldozer option before it's even released?

dividebyzero dividebyzero, trainee n00b, said:

my question about Intel is, why are the new Sandy Bridge processors priced so low?

They are mainstream parts. More to the point they are designed to cannibalize the LGA1156 market. At a 32nm process (putting aside the probable better yields) you are getting significantly more dies per wafer than Lynnfield (216mm² for SB 4 core* versus 296mm² for Lynnfield). If mainstream CPU production is reduced at 45nm then those same fabs can churn out Atom CE4100 (for example) instead.

Are they trying to drive out AMD for good?

Competition regulators would ensure that AMD in some guise would be viable (a monopolies issue) even if AMD's IP and cross-licencing agreements with Intel didn't make it a lucrative acquisition for another company. Intel needs competition- what it doesn't need is strong competition.

Head off any less (haha see!) expensive Bulldozer option before it's even released?

With the beancounters at the helm of AMD I think that the chances of a relatively inexpensive consumer Bulldozer (Zambesi) product line are nearing nil. AMD's board are obviously wanting a bigger return on investment and a higher average selling price for it's products. This makes sense if AMD are trying to quickly boost AMD's P&L, raise the share price and make a tidy profit when Mubadala/ATIC move to claim full ownership of AMD

"AMD is not for sale, but we are happy to listen to any proposal which is in the interest to our shareholders," [now Ex-]Chief Executive Dirk Meyer told an industry conference in Barcelona.

A rather ambiguous statement at best, and maybe not the vision that the rest of the board share.

* The die per wafer ratio improves to a greater extent if you factor in Sandy Bridge 2 core -GT1 and GT2 -parts ( 131 and 149mm² respectively)

Guest said:

Intel seems to operate at Gross profit margins of 35-50% .. which is fantastic for their shareholders but makes you realize that if they wanted/needed to, with a bit of cost cutting, they could price AMD out of the market,even with product priced at 50% less. The market is a bit more complicated than that of course. I haven't upgraded from Xp/C2D and would dearly love one of these new sandy bridge *but* I think I''ll spend on SSD and more RAM first, and wait for the next gen. I am more interested in getting a UEFI mobo as well. May even wait for W8, and go Octo all round (w8, 8gb ram 8tb storage 8core CPU)

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