Intel Corp, the world's biggest maker of chips and chipsets, and rival Via Technologies Inc (
Financial terms weren't disclosed. The rivals signed a 10-year agreement to license each other's products and Intel agreed not to assert its patents on some microprocessors for three years, the companies said. Intel gave Taiwan-based Via a four-year license to design and sell chipsets compatible with Intel microprocessors. Intel will get some royalties.
The settlement opens a larger market for Via, though it also may force the company to raise prices on chipsets and microprocessors, said Kevin Krewell, an analyst at MicroDesign Resources who doesn't own shares of Via or Intel.
"It's a double-edge sword for Via," Krewell said. "Any money they're paying Intel for licensing will cut into their margins and may force them to raise their prices slightly."
An appeals court in February denied Santa Clara, California-based Intel a new trial in one suit against Via. Intel and Via were involved in as many as 11 suits over 27 patents in Texas, California, China, Hong Kong, the UK, Germany and Taiwan.
"This clears everything," Intel spokesman Chuck Mulloy said.
Via's sales in the first quarter this year fell by 22 percent to NT$5.7 billion (US$163.6 million) compared with the same period a year ago, based on monthly revenue reports from the company.
Via's profit in the third quarter last year, the most recent period in which the company posted earnings, tumbled to NT$44 million from NT$882 million in the year earlier period. Via's net income fell in each of the first three quarters last year.
Prices for chipsets, which work with processors in a computer to control graphics and memory, have plunged as demand for personal computers have ebbed.
Intel shares rose US$0.30 to US$17.35 on the Nasdaq Stock Market. Via shares rose NT$2.30 to NT$36 in Taipei. The settlement was announced after the close of regular U.S. trading.
Intel first sued Via in September 2001, alleging infringement of patents in microprocessor and chipset products. Via countersued, saying Intel's microprocessors infringed three patents Via acquired through an acquisition of Centaur.
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