Update 2: Our full analysis of the agreement is now available here: Intel Settles With NVIDIA: More Money, Fewer Problems, No x86

In about 30 minutes NVIDIA will host a conference call to announce its 6-year $1.5 billion license agreement with Intel. Intel will pay annual installments totaling $1.5 billion over 6 years beginning January 18th.

We'll have full details after the conference call. The license agreement stems from the Intel/NV dispute over the right to build chipsets that interface with Intel CPUs that use DMI/QPI instead of the traditional GTL+ FSB.

After Project Denver and the Tegra 2 announcements at CES, it looks like NVIDIA is shaping up to have a good start to 2011.

Update: While we're still working on our full rundown of the agreement, there's been some speculation over at Ars Technica about what this agreement means for Intel; specifically claiming that NVIDIA GPUs will be appearing in Intel CPUs, on the basis of the fact that Intel is licensing NVIDIA technology. I'm not a lawyer (though I do play one on the Internet) however I disagree with this reading - Intel has to license NVIDIA technology to avoid running afoul of the company's large patent portfolio with their own IGPs. It's for all practical purposes impossible to build a desktop GPU without infringing on an AMD/NV patent. This agreement allows Intel to continue producing their IGPs, just as how the original 2004 chipset agreement allowed Intel to produce more modern IGPs in return for NVIDIA getting a chipset license. -Ryan Smith

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  • mino - Monday, January 10, 2011 - link

    All of that to some degree :) Reply
  • has407 - Monday, January 10, 2011 - link

    There's $100M that might be "settlement". The rest is licensing/IP $--or at least that's how it's essentially accounted for according to Intel:

    "The remaining amount, approximately $1.3 billion, will be recognized as an intangible asset in the first quarter of 2011 and will be amortized into cost of sales over future periods."
    Reply
  • MeanBruce - Monday, January 10, 2011 - link

    Seems clear that it's just a settlement packaged into an aggrement wrapped in an enigma so neither party will be held to blame, right? Reply
  • MeanBruce - Monday, January 10, 2011 - link

    Ok agreement, damn iPhone keyboard! Those spelling police are rough here! Reply
  • InternetGeek - Monday, January 10, 2011 - link

    Maybe the title confuses the matter because if Intel owns DMI/QPI then it should be nVidia paying Intel, unless nVidia's claims do have grounds and Intel is just too busy performing well as they are right now. In any case the agreement is pretty much pocket change and not likely to push Intel into the red or nVidia into the blue. Reply
  • GeorgeH - Monday, January 10, 2011 - link

    To put that $1.5 Billion in perspective, Intel makes about $2.5 Billion (profit) per quarter. Spread over 24 quarters, that $1.5 Billion is about $63 Million, or 2.5% of Intel’s profit.

    If you look at it in terms of sales, Intel takes in about $10 Billion per quarter, making that $1.5 Billion about 0.6% of their sales. In human terms, that means for every $1,000 Intel rakes in they're going to toss Nvidia $5.
    Reply
  • AnandThenMan - Monday, January 10, 2011 - link

    Well said. Which is why Intel doesn't give a flying crap about getting caught for illegal practices, or being hauled into court by their competitors. It's money well spent for them, really. Reply
  • cmdrdredd - Monday, January 10, 2011 - link

    Intel is out there to make money. Just because AMD sucks right now doesn't mean a thing. It's only illegal if the courts say it is. In this case they did nothing illegal because the court system did not find them guilty. Just like you can be charged with a crime, but you are always innocent until they prove you really did what they claim. Reply
  • AnandThenMan - Monday, January 10, 2011 - link

    So you're saying that Intel does a bunch of potentially illegal stuff, but because they have not been found guilty in court, it's all good because Intel is there to "make money" Gotcha.

    No harm was ever done because they were not found guilty by a judge or jury. Excellent.
    Reply
  • shiznit - Monday, January 10, 2011 - link

    That's not what he is saying.

    He is just making the argument that a public company has an obligation to make as much money as possible and that the same burden of proof that protects you and I from prosecution without due process also applies to Intel.

    I agree that $1.5 is chump change to Intel and is a steal to knock a competitor out of a market, but if nothing can be done about it legally it is the fault of bad laws and not an "evil" corporation.
    Reply

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