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Can Intel revoke AMD's x86 license?

Posted on Wednesday, October 08 2008 @ 19:19:53 CEST by

When I first heard about AMD's asset lite strategy I had my doubts as the whole plan seems like a direct violation of the cross-licensing agreement between AMD and Intel. Intel is the inventor of the x86 processor architecture and AMD needs to pay royalties to Intel in exchange for the right to manufacture its own x86 chips.

It's believed that the x86 license is part of the cross-licensing agreement, along with several restrictions. AMD can't transfer the license to a third party nor can it outsource more than 20 percent of its chip production.

It looks like the deal AMD announced yesterday to spin-off its fabs in a joint-venture with Abu Dhabi may violate the agreement. Intel said on Tuesday it has "serious questions" about the deal and that it will defend patent rights against AMD:
Intel spokesman Chuck Mulloy said that AMD and Intel have a patent cross-licensing agreement under which AMD pays royalties to Intel.

"Intel has serious questions about this transaction as it relates to the license and will vigorously protect Intel's intellectual property rights," Mulloy said of AMD's announcement.

Mulloy said Intel has asked AMD to make the agreement public but he said it would not, so he was not at liberty to discuss the matter in detail.
If AMD is in violation of the agreement, Intel could theoretically revoke AMD's right to manufacture x86 chips but on the other hand, this could place Intel in a nasty legal position as it would get the de facto monopoly on x86 processors.



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