VIA Technologies Inc (
The new business division, VIA Platform Solution Division (VPSD), is aimed to boost demand for the company's main product as it is locked in a legal battle with Intel Corp about its chipsets infringing the top chipmaker's patents.
Taipei-based VIA, the second-largest seller of chipsets, will hire manufacturers in the region to produce boards for its chipsets that support Intel's Pentium4 processor, the company said in a statement. VIA didn't identify the suppliers.
Stung by Intel's accusations, Via has struggled to sell its latest chipsets, forcing it earlier this month to cut its profit target for the year. Making its own motherboards may prompt customers to place orders without incurring Intel's wrath, a prospective rival in Taiwan said.
"It's a tactic to resolve Intel's legal actions," Kreps Lin, the financial controller at Elitegroup Computer System Co (
Shares in VIA fell 2.1 percent to NT$69.5 yesterday. The stock has fallen 13 percent since Intel accused VIA on Sept. 8 of breaching five of its patents. Intel asked a US court to bar VIA from making Pentium4 chipsets and is demanding compensation. VIA contends it does not need a license to sell the chipsets.
Some VIA customers are shying away, fearing similar action, after Intel, earlier this month, filed suits against Elitegroup for using VIA's Pentium-compatible chipsets.
"VIA is facing a problem promoting its chipsets," said Steven Liao, technology analyst at HSBC Securities (Taiwan) Ltd. "Intel has boxed VIA into a corner by threatening its clients with legal action."
VIA, which holds 40 percent of the US$3 billion global chipset market, doubled its market share in less than three years, helped by Intel's failure to meet demand.
VIA, earlier this month, cut its pretax profit forecast for the year by more than a third to NT$5.3 billion (US$153 million), blaming a slump in the PC market.
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