Intel May Yank AMD’s Cross-Licensing Agreement

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AMD has announced that Intel plans to pull its 2001 cross-licensing patent agreement within the next 60 days if concerns over the transfer of licenses and patents are not addressed.

The joint-chip foundry, tentatively called The Foundry Company, calls for the government's Advanced Technology Investment Co. (ATIC) to own a majority 55.6 percent stake, but AMD and ATIC will hold equal voting rights. The deal officially closed earlier this month.
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How would this affect AMD's licensing of x86-64 to Intel? If Intel attempts to bury AMD, AMD would naturally bury Intel by yanking the x86-64 license.

Intel's blowing a hell of a lot of smoke here. Seems like they're just flexing a muscle they don't actually have.
 
phide said:
How would this affect AMD's licensing of x86-64 to Intel? If Intel attempts to bury AMD, AMD would naturally bury Intel by yanking the x86-64 license.

Intel's blowing a hell of a lot of smoke here. Seems like they're just flexing a muscle they don't actually have.
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Under the 2001 deal, a party that has been found to be in materially breach of agreement will no longer have access to the patents and licenses. However, the other party, providing they were not found to be in material breach, would still retain the right to access the information.
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Intel would still have the right to use anything it has already so they could still use x86-64 for their CPUs while AMD would be neutered.

AMD would have obviously seen something like this happening when planning to make a foundry spin off. I'd expect AMD to have a pretty decent defense built up by now, it will be interesting to see how this pans out. I wonder what Intel's legal bills are going to amount to for 2009?
 
FiZuR said:
what a sneaky thing for intel to consider.
Click to expand...
It was in the terms of the agreement, redacted in the public version, but somewhat confirmed by AMD itself that the maximum production they could outsource was around 20%. Intel even warned AMD last year that splitting off manufacturing would violate the cross-license.

Court is usually slow, but since notifying AMD, AMD has 60 days to "correct" the violation, or it's going to get very interesting for AMD and Intel real fast.

phide: it makes no difference for the x86-64 "license." There probably isn't one (a FANtasy started at a certain Intel-hating UK web site) since it is an open standard and Intel has its own implementation. Even if there was, Intel gets to keep any technology licensed to it if the other party breaks the agreement.
 
AMD notes that parties seek to resolve the issue through mediation and that both are currently taking the stance that the other has materially breached the 2001 agreement.
Click to expand...
How can AMD claim that Intel breached the agreement?
 
Silent.Sin said:
Intel would still have the right to use anything it has already so they could still use x86-64 for their CPUs while AMD would be neutered.
Click to expand...

Hm, if there is no crosslicencing, then Intel have no licence to make x86-64, and AMD have no licence to make x86-32. There is either crosslicencing or not, there is no middle point.
 
What can Intel really do here? What does it mean when Intel yanks the License Agreement? Intel may claim that AMD is producing x86 CPUs without license, AMD will claim that they did nothing wrong and still have the license. Intel could sue AMD for manufacturing the x86 CPUs without license, whether they will win the case or not is another story but the legal process will be a long one and the fact that Intel is suing AMD for the license won't be a good thing for Intel's anti monopoly case.
 
Makes no sense.

They could have just pushed out i5 and buried AMD outright if that is what they wanted. As it stands they can sit back and cash in on products that are waiting to go and wait for AMD to catch up, while letting the dough pile up or R&Ding their next big thing.

More then likely they just want to squeeze better terms out of a renegotiated deal.

Intel would have to be stupid, which it's not, to want to kill off AMDs CPU business.
 
intel is pitching a bitch cause they expected amd to go under but amd found a life raft and is in a stable position and winning antitrust cases god forbid if amd wins the US one
 
^^ hardly, Intel wont let AMD go under, period, cause if they did Intel would be so screwed and under a microscope, not that they are already.

Bottom line is, AMD is potentially, breaching a contract, i love how suddenly Intel is some big bad company because they are trying to hold someone to a contract :rolleyes:
 
MrGuvernment said:
^^ hardly, Intel wont let AMD go under, period, cause if they did Intel would be so screwed and under a microscope, not that they are already.

Bottom line is, AMD is potentially, breaching a contract, i love how suddenly Intel is some big bad company because they are trying to hold someone to a contract :rolleyes:
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Welcome to the world of fanboys ;)
 
maxius said:
intel is pitching a bitch cause they expected amd to go under but amd found a life raft and is in a stable position and winning antitrust cases god forbid if amd wins the US one
Click to expand...

punc⋅tu⋅a⋅tion
   /ˌpʌŋktʃuˈeɪʃən/ [puhngk-choo-ey-shuhn]
–noun
1. the practice or system of using certain conventional marks or characters in writing or printing in order to separate elements and make the meaning clear, as in ending a sentence or separating clauses.
2. the act of punctuating.
3. punctuation marks.

Woo!

BTW I doubt very much Intel wants to push AMD out of business. They merely want to whip AMD into conforming to Intel's policy. Basically Intel's acting like God Almighty of the CPU realm.
 
Azhar said:
They merely want to whip AMD into conforming to Intel's policy.
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It's actually simplier than that. For a contract to be enforceable, the terms have to be enforced when there is a (potential) violation. It's not smoe random "Intel policy," it's a binding contract both parties signed. Geez, since no one seems to have read the agreement, here's a link: http://contracts.corporate.findlaw.com/agreements/amd/intel.license.2001.01.01.html

Intel wouldn't be in a very good position if they held off notifying AMD for 2 years, but days after the split is timely.

And just let me say i told ya so, even before the split was announced. :p
 
From the link pxc provided and the tone of the article, the big question is probably around the sectio nrelated to subsidiaries:

1.22. "Subsidiary" shall mean any corporation, partnership, joint venture,
limited liability or other entity, now or hereafter, in which a
party

(a) owns or controls (either directly or indirectly) or originally
contributed (either directly or indirectly) at least fifty
percent (50%) of the tangible and intangible assets of such
entity; and

(b) owns or controls (either directly or indirectly) either of the
following:

(1) if such entity has voting shares or other securities, at
least fifty percent (50%) of the outstanding shares or
securities entitled to vote for the election of
directors or similar managing authority and such entity
is under no obligation (contractual or otherwise) to
directly or indirectly distribute more than seventy
percent (70%) of its profits to a third party, or

(2) if such entity does not have voting shares or other
securities, at least fifty percent (50%) of the
ownership interest that represents the right to make
decisions for such entity and an interest sufficient to
receive at least thirty percent (30%) of the profits
and/or losses of such entity.

(c) An entity shall be deemed to be a Subsidiary under this
Agreement only so long as all requisite conditions of being a
Subsidiary are met.

The Abu Dhabi investment arm (ATIC) owns/controls 55.6% of GlobalFoundries per Cnet. Again from the Cnet article, it seems like AMD's response is that despite investing less than 50%, they have equal decision making rights with ATIC. From the wording in the contract, it's unclear if an agreement like that would satisfy, since the contract specifically cites ownership of shares.

In the end, it's a situation that will likely have to be decided by a judge unless a separate negotiation happens to resolve this
 
One of the better responses to this from Engadget's reporting of this lawsuit is this:
"AMD licenses the x86 instruction set. The x64 is a extension on the x86 instruction set.

This story is going back years ago, when AMD was a licensed manufacturing plant, making Intel CPU's. My memory is fussy about the whole deal, but it came down to it, that Intel wanted to do production only in house anymore. AMD started with there own CPU's, using the x86 instruction set. This came to court when Intel sued AMD. Fearing that Intel was going to lose ( and lose its patent on the x86 instruction set ), a agreement was done. AMD was able to use the x86 instruction set.In return, one off the conditions was, that AMD was not allowed to produce the CPU outside there own management. Aka, limiting there production capability.

There are more restrictions on that deal, but thats the one that matters for this case.

By going to a external production plant, AMD is able to do more CPU production, need to spend less money on the constant die shrink war ( 64nm->42nm->32nm ... ). A win win situation for AMD, but a problem for Intel. When the original Athlon where kicking Intels P4's, AMD was extremely limited by its production capability ( you don't put up a production plant in 1 2 3 ... ). This limitation allows Intel to keeps its market dominance, as AMD is pron many time to limits on the amount off CPU's it can produce.

Company's like Dell need a steady supply off CPU's. A company that can only do xx each month, when they need twice or three times that, is a relative bad parter for Dell, Compaq, HP... So, they are again, limited from breaking into that lucrative market... At best AMD has/had the production capability to do 25% off the market.

They ( Intel ) are playing bluff poker, but denying the x86 instruction set is close to impossible. Intel needs to be careful, or else they might just end up losing there x86 patent if it gets to court. Trust me, it will again end in a settlement, with Intel putting limits in place to prevent AMD from mass production competition." - Benjiro

It just appalls me that Intel will go to great lengths to limit AMD however any way possible so that Intel remains at top and AMD stays at the bottom.

I'd rather see the courts dissolve this contract and the x86 license removed from Intel, and a 50/50 split on it instead with no strings attached and no fine print. That way we have two separate and equally independent companies free to do however they please with the x86 license.

Hopefully it's as simple as that. I'd rather prefer competition than one company owning the majority of it like Microsoft.
 
Azhar said:
punc⋅tu⋅a⋅tion
   /ˌpʌŋktʃuˈeɪʃən/ [puhngk-choo-ey-shuhn]
–noun
1. the practice or system of using certain conventional marks or characters in writing or printing in order to separate elements and make the meaning clear, as in ending a sentence or separating clauses.
2. the act of punctuating.
3. punctuation marks.

Woo!

BTW I doubt very much Intel wants to push AMD out of business. They merely want to whip AMD into conforming to Intel's policy. Basically Intel's acting like God Almighty of the CPU realm.
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A+++++++++ post, would read again! Thx gr8 poster!

-eBay feedback ;)
 
Isn't Intel x86 patent pretty old at this point? Won't it expire in the next couple of years?
 
It's probably that the cross-license covers more than simply the x86 instruction set. The link to the contract that pxc provided shows that it seems to be pretty wide ranging. However, all the details are redacted for confidentiality.
 
Intel wants to cheat mainly by limiting amds production. If amd were able to supply all the big manufactures demands(dell,hp, and all them) then intel would be threatened. Basically they are trying to be a monopoly as long as possible. The x86 instructions should be public domain by now.
 
octoberasian said:
One of the better responses to this from Engadget's reporting of this lawsuit is this:
"AMD licenses the x86 instruction set. The x64 is a extension on the x86 instruction set.

This story is going back years ago, when AMD was a licensed manufacturing plant, making Intel CPU's. My memory is fussy about the whole deal, but it came down to it, that Intel wanted to do production only in house anymore. AMD started with there own CPU's, using the x86 instruction set. This came to court when Intel sued AMD. Fearing that Intel was going to lose ( and lose its patent on the x86 instruction set ), a agreement was done. AMD was able to use the x86 instruction set.In return, one off the conditions was, that AMD was not allowed to produce the CPU outside there own management. Aka, limiting there production capability.

There are more restrictions on that deal, but thats the one that matters for this case.

By going to a external production plant, AMD is able to do more CPU production, need to spend less money on the constant die shrink war ( 64nm->42nm->32nm ... ). A win win situation for AMD, but a problem for Intel. When the original Athlon where kicking Intels P4's, AMD was extremely limited by its production capability ( you don't put up a production plant in 1 2 3 ... ). This limitation allows Intel to keeps its market dominance, as AMD is pron many time to limits on the amount off CPU's it can produce.

Company's like Dell need a steady supply off CPU's. A company that can only do xx each month, when they need twice or three times that, is a relative bad parter for Dell, Compaq, HP... So, they are again, limited from breaking into that lucrative market... At best AMD has/had the production capability to do 25% off the market.

They ( Intel ) are playing bluff poker, but denying the x86 instruction set is close to impossible. Intel needs to be careful, or else they might just end up losing there x86 patent if it gets to court. Trust me, it will again end in a settlement, with Intel putting limits in place to prevent AMD from mass production competition." - Benjiro

It just appalls me that Intel will go to great lengths to limit AMD however any way possible so that Intel remains at top and AMD stays at the bottom.

I'd rather see the courts dissolve this contract and the x86 license removed from Intel, and a 50/50 split on it instead with no strings attached and no fine print. That way we have two separate and equally independent companies free to do however they please with the x86 license.

Hopefully it's as simple as that. I'd rather prefer competition than one company owning the majority of it like Microsoft.
Click to expand...


I'm fairly certain I know who you voted for.

Intel developed the x86 architecture. Intel is entitled to keeping it an Intel IP. Just disolving a contract because it's "not fair" to the little guy is absurd.
This isn't the same as Monster™ Cable telling other people they can't use a name, It's the inventor of something saying how their patented and protected property can be used, which they can.
 
Lebowski said:
I'm fairly certain I know who you voted for.

Intel developed the x86 architecture. Intel is entitled to keeping it an Intel IP. Just disolving a contract because it's "not fair" to the little guy is absurd.
This isn't the same as Monster™ Cable telling other people they can't use a name, It's the inventor of something saying how their patented and protected property can be used, which they can.
Click to expand...

Yes but all the other architectures were removed from windows since NT. So the only supporting architecture is the x86. Its basically a monopoly. Anything made outside of x86 wouldn't work on windows right now.
 
Lebowski said:
I'm fairly certain I know who you voted for.

Intel developed the x86 architecture. Intel is entitled to keeping it an Intel IP. Just disolving a contract because it's "not fair" to the little guy is absurd.
This isn't the same as Monster™ Cable telling other people they can't use a name, It's the inventor of something saying how their patented and protected property can be used, which they can.
Click to expand...

its a little different... actually if the government wanted they could claim its a national security issue to have a single vendor for the CPUs that power xyz device and tell whoever they want, lets say, Ti, to start making x86 cpu's and intel cant do anything about it...

it wouldent be the first time it happened...

that being said i have a feeling nVidia is going to be the one thats going to go after intels throat, trying to get their own x86 agreement by screaming anti-competitive or god knows what
 
Conker said:
Intel wants to cheat mainly by limiting amds production. If amd were able to supply all the big manufactures demands(dell,hp, and all them) then intel would be threatened. Basically they are trying to be a monopoly as long as possible. The x86 instructions should be public domain by now.
Click to expand...
AMD couldn't satisfy those OEMs' demands, even if they wanted to.
 
Conker said:
Yes but all the other architectures were removed from windows since NT. So the only supporting architecture is the x86. Its basically a monopoly. Anything made outside of x86 wouldn't work on windows right now.
Click to expand...

Umm Windows 2008 for Itanium...
 
This will end in a settlement. Its pretty simple what Intel gets out of this. If Intel pulls the license, they will have to sue AMD to get them to stop. This lawsuit will drag out for years if it happened. This would cost AMD millions and millions of dollars. Not something that AMD can really afford to be spending money on.

That isn't even the biggest thing for Intel. Intel can go to all the PC manufacturers and resellers and tell them they are selling unauthorized AMD CPUs. Intel can threaten them with legal action also for selling or using AMD CPUs.

Then there is the scare tactics that they could use with the public. I could see the media putting out reports about this and recommending that people not buy AMD CPUs until this is resolved.

But as I said, this will never go to trial. Even if AMD wins, they would have lost much more in the process that would have been gained.
 
Conker said:
Yes but all the other architectures were removed from windows since NT. So the only supporting architecture is the x86. Its basically a monopoly. Anything made outside of x86 wouldn't work on windows right now.
Click to expand...

Being a monopoly is not illegal, at least in the US. However, monopoly companies have more restrictions on what they can and can't due under the law than non-monopolies. However, I'm pretty certain that lawful protection of their IP is allowed. If Intel's interpretation of the contract language is correct, then they can pursue this course of action without fear of consequence in the US. EU law could be another matter entirely, of course.
 
could be interesting :D

AMD would have known about this possibility the moment the exec mentioned spinning off their manu base
My thoughts are AMD are gonna attack the patent on the x86 instruction set
Intel only licenced it because they thought they were abt to lose the original case with AMD

would save AMD alot of money in the longrun and others
 
Aganerral said:
Being a monopoly is not illegal, at least in the US. However, monopoly companies have more restrictions on what they can and can't due under the law than non-monopolies. However, I'm pretty certain that lawful protection of their IP is allowed. If Intel's interpretation of the contract language is correct, then they can pursue this course of action without fear of consequence in the US. EU law could be another matter entirely, of course.
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Actually, in a moment AMD would lose his x86 crosslicencing, Intel would be separated in few competing companies by US antitrust law (see AT&T) :
http://en.wikipedia.org/wiki/Bell_System_divestiture
 
octoberasian said:
It just appalls me that Intel will go to great lengths to limit AMD however any way possible so that Intel remains at top and AMD stays at the bottom.
Click to expand...

Yeah, because, god forbid a company would want to maintain market dominance. :rolleyes:
 
The breakup was the result of a case brought against AT&T for mis-using its monopoly power, which is not the same as the government breaking up AT&T just because it was a monopoly. From http://en.wikipedia.org/wiki/United_States_v._AT&T:

In the 1970s the Federal Communications Commission suspected that the American Telephone & Telegraph Company was using monopoly profits from its Western Electric subsidiary to subsidize its the costs of its network , which was contrary to U.S. antitrust law.

Obviously there are pending antitrust complaints against Intel separate from the issue of this particular contract. If Intel is found guilty in one of those then the government could force certain actions as was done with AT&T. But barring that, there would be no grounds for action against Intel simply bor being a monopoly.
 
And do you really think Intel will not misuse the position of sole x86 producer ? Of course he will do, or do you really think prices will stay same/comparable as they are now. Don't make me laugh.
 
Aganerral said:
From the wording in the contract, it's unclear if an agreement like that would satisfy, since the contract specifically cites ownership of shares.
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There's a little more than that, :p The clause that states what % of chips AMD can outsource has been redacted from the public contract (along with royalty rates and other details).

It's pretty clear that spinning off 100% of production to a company that AMD owns a little more than a third of violates the letter of the contract. AMD tried to use a 50% voting rights thread to appear compliant, but that's a joke since it's just a symbolic gesture and ignores the other provisions that the deal violates.

http://biz.yahoo.com/bw/090316/20090316005841.html?.v=1

SANTA CLARA, Calif.--(BUSINESS WIRE)--Intel Corporation today disclosed that the company has notified Advanced Micro Devices (AMD) that it believes AMD has breached a 2001 patent cross-license agreement with Intel. Intel believes that Global Foundries is not a subsidiary under terms of the agreement and is therefore not licensed under the 2001 patent cross-license agreement. Intel also said the structure of the deal between AMD and ATIC breaches a confidential portion of that agreement. Intel has asked AMD to make the relevant portion of the agreement public, but so far AMD has declined to do so. AMD’s breach could result in the loss of licenses and rights granted to AMD by Intel under the agreement.

"Intellectual property is a cornerstone of Intel’s technology leadership and for more than 30 years, the company has believed in the strategic importance of licensing intellectual property in exchange for fair value. However AMD cannot unilaterally extend Intel’s licensing rights to a third party without Intel’s consent,” said Bruce Sewell, senior vice president and general counsel for Intel. “We have attempted to address our concerns with AMD without success since October. We are willing to find a resolution but at the same time we have an obligation to our stockholders to protect the billions of dollars we’ve invested in intellectual property.”

Under terms of the license agreement the notification to AMD means the parties will attempt to resolve the dispute through mediation. In response to the notification AMD claimed Intel breached the agreement by notifying AMD of its breach. Intel believes that position is inconsistent with the dispute resolution process outlined in the original agreement.
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Waffles @ the last paragraph. It's pretty clear that AMD wants to unilaterally break the agreement while continuing to use Intel's patents. Sounds like Wrector wrote the response, it's so ridiculous.
 
Intel cannot decide whether the agreement is breached or not. They can try to resolve the dispute through a mediation or they can bring the matter to the court to decide whether the agreement was breached or not for whatever reason. They cannot just terminate the license without the risk of losing the license from AMD because the action itself will be a breach of the agreement.
 
Conker said:
Yes but all the other architectures were removed from windows since NT. So the only supporting architecture is the x86. Its basically a monopoly. Anything made outside of x86 wouldn't work on windows right now.
Click to expand...

Well, first off, all the alternate OS guys are constantly preaching that their systems are a viable desktop alternative, so you've got a whole range of architectures to choose from with Linux/BSD/Darwin.

And second, you're mostly right on the Windows part (desktop versions, at least), but all the Server versions of Windows are available on several architectures. It'd be very easy to also compile Vista or 7 for other systems.
 
I just have to laugh at some of the commentary in this thread. I never get tired of seeing all the anti-business rhetoric, and people thinking all companies should willingly slack off and give up market share to other companies to "be fair." Sorry guys, but this is how business is supposed to work, it's competitive, not a bunch of stoners around a hookah having a grand ole time.
 
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