Intel pays AMD $1.25 billion to end dispute

Intel Corporation (Intel), the world leader in silicon technology and the monopolistic computer chip maker yesterday settled a long standing dispute with its arch rival Advanced Micro Devices Inc (AMD), by agreeing to pay the latter $1.25 billion as compensation.

The four-year row in the US District Court in Delaware, termed as one of the most complex cases in the federal courts, ended with both the companies entering into a new 5-year cross license agreement and giving up any violation claims from the previous license agreement, on top of Intel paying AMD $1.25 billion.

Intel and AMD said in a joint statement: ''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."

Intel commands virtual monopoly over computer chips with over 80 per cent of global market share, while AMD has close to 20 per cent.

The comprehensive settlement brings an end to all pending disputes between Intel and AMD, including antitrust litigation and patent cross license disputes in Delaware and two cases in Japan, as well as regulatory complaints worldwide. Intel has also agreed to abide by a set of business practice provisions.

Ending of the dispute with AMD does not mean that Intel is out of the woods, as there are lawsuits still pending with the European Union, New York state attorney general and Federal Trade Commission against Intel's unethical business practices and antitrust accusations.