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November 12, 2009

Intel and AMD settle spat

$1.25bn heading AMD’s way

By Steve Evans

Intel has agreed to pay rival chip maker AMD $1.25bn (£755m) in a deal that settles all outstanding legal issues between the firms.

The two companies issued a joint statement that said they had agreed a five-year cross licensing deal and both parties will abandon claims of breaching previous agreements. AMD will also drop all outstanding cases against Intel, including cases in the U.S. District Court in Delaware and two in Japan.

“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, the companies said in a joint statement.

The two firms have been at loggerheads for a number of years over what AMD considered to be anti-competitive behaviour from Intel. Earlier this year, the EU fined Intel a record €1.06bn (£950m) over claims that it offered hidden rebates to customers such as Dell, HP and Acer in return for buying all, or almost all, their chips from Intel instead of rival offerings from AMD.

In an interview with CBR shortly after the EU’s ruling, Wolfgang Petersen, director of the developer relations division for Intel EMEA, defended his firm’s actions and said that their behaviour was industry-standard.

“Rebates are absolutely normal in the industry – if you go to a company and buy 10 units, you get a certain price. If you buy 1,000 units, you get a different price – that is a rebate. It is normal in our business,” he said.

Intel’s appeal against the EU ruling is unaffected by this announcement.

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