01:16 AM

Will Intel Make Peace With Nvidia? FTC Continues Probe

Despite Intel's recent settlement of a legal dispute with AMD, the Federal Trade Commission (FTC) is continuing its investigation of the world's largest chipmaker, reports Arik Hesseldahl in BusinessWeek.

AMD agreed to withdraw its complaint against Intel with FTC as part of a settlement which included a payment by Intel of $1.25 billion.

But the FTC is still investigating the legal dispute between Intel and Nvidia, the graphics chip maker, says BusinessWeek.

However, it's not clear what the FTC is concerned about in regards to Intel and Nvidia because it normally investigates allegations of anti-trust business activities. The dispute between Intel and Nvidia is over rights to key chip technologies related to a 2004 cross-technology licensing agreement.

Intel said the pact didn't give Nvidia the right to make Nehalem-compatible chipsets. Nvidia argued the opposite. Intel sued in the Delaware Court of Chancery. Nvidia countersued in the same court in March, alleging breach of contract, accusing Intel of unfair dealing, and asking a judge to terminate Intel's rights to Nvidia patents covered in the agreement.

Nvidia has been taking some pot shots at Intel. It launched a site called "Intel's Insides." It consists of black and white cartoons poking fun at Intel.

The FTC has said it will be tougher under the Obama administration on misbehaving US corporations but it will have a tough time putting together as lawsuit against Intel if all it has is the Nvidia contract dispute.

In November there were reports that Nvidia was secretly preparing an Intel-compatible microprocessor. [Nvidia Could Be Prepping Intel Compatible Chips.]This is likely a tactic to put pressure Intel to settle their dispute.

It's unlikely that the lawsuits will reach court. These types of disagreements are nearly always settled out-of-court and usually with a new cross-license agreement.