Costly marriage of convenience
Intel and Nvidia have announced a six-year cross licensing agreement that will cost Intel $1.5 billion over the next five years. Nvidia will receive the first payment on January 18 2011.
In return for such a generous dowry, Intel will receive access to Nvidia’s full range of patents, while Nvidia will retain use of Intel patents in accordance with its existing six-year agreement with Intel. Under the terms of the agreement, both companies will drop all outstanding legal disputes between them.
Intel general counsel Doug Melamed said that the agreement will put an end to legal disputes between the companies and “preserve patent peace”. Nvidia CEO Jen-Hsun Huang announced that the agreement will signal the start of a new era for Nvidia, which probably means he won’t take any potshots at Intel in the future.
Although we all knew some sort of an agreement was in the making, the timing of the announcement will surely raise quite a few eyebrows. The past week has seen Nvidia’s stock jump from $15.5 to just over $20 thanks to the Green Goblin’s good showing at CES. Announcing this agreement just a couple of days after the CES dust settled can’t be a coincidence.
We told you Huang would make a good politician.