After Intel accused AMD on Monday of breaching a 2001 patent cross-license agreement with Intel, AMD's top lawyer had some choice words for its bigger rival.
In a phone interview Tuesday, AMD general counsel Harry Wolin refuted Intel's claim that the AMD manufacturing spin-off Globalfoundries is not a subsidiary--and thus cannot legally use Intel intellectual property--and talked more broadly about Intel's tactics.
Intel's ultimate goal, Wolin believes, is to crush rivals into oblivion. "In their perfect world, we wouldn't exist. If they had to deal with the government every now and then, that's fine, and they're still extracting monopoly profits from the industry," he said.
Wolin doesn't buy into the oft-repeated theory that Intel needs AMD to keep the industry honest and to keep the U.S. government at bay. "I don't agree with the premise that they have to have us and they think they have to have us. I think they would absolutely like us dead," Wolin said.
The Dickensian depiction of AMD as the impoverished, distressed victim of Intel's bullying and manipulation is inaccurate and, more importantly, misses the relevant point, according to Intel spokesman Chuck Mulloy. "It's nice of them to try to speak for us. AMD has been a competitor for almost 40 years in one form or another. This is not about AMD going away," he said. "This is about our rights and AMD's rights under the patent cross-license agreement."
Ashok Kumar, an analyst at investment bank Collins Stewart, said the premise of a remorselessly predatory Intel set on killing off its rivals is attention-getting but not that realistic.
"Could Intel put them out of business? Probably. But is it a likely outcome? I don't think so," he said. "Because they'll get a lot of significant push back from the OEMs (PC makers). The OEMs will essentially be making a beeline to Washington, D.C."
Intel contends this is a very localized dispute about whether Globalfoundries is a subsidiary or not, and not a manufactured issue "to distract the world from the global antitrust scrutiny (Intel) faces," as AMD said in a statement Monday. "AMD cannot unilaterally extend Intel's licensing rights to a third party without Intel's consent," said Bruce Sewell, senior vice president and general counsel for Intel, in a statement on Monday. Intel maintains the issue is that Globalfoundries is 34.2 percent owned by AMD and 65.8 percent-plus owned by Advanced Technology Investment Co., an investment company. So, in effect, Globalfoundries is not an AMD subsidiary.
Wrong, AMD says. It is not about ownership. AMD has met the conditions that qualify it as a subsidiary. "It requires that AMD originally contributed at least 50 percent of the assets. If you look at the fact that we've thrown in the German factories, we've thrown in the people, we've thrown in the technology, we've thrown in the intellectual property. I don't think there's any credible argument that says we haven't thrown in more than 50 percent of this. It says nothing about owning. It says you have to originally contribute 50 percent of the assets," Wolin said.
And what happens from here?
"Let's say the parties end up in a lawsuit at the end of 60 days," Wolin said. (Intel says it will terminate AMD's rights and licenses under the cross license in 60 days if the alleged breach has not been corrected.) "Well, you know, that lawsuit doesn't come to court for years and wouldn't come to court until well after the antitrust suit would come to court, which is currently scheduled for February of next year," according to Wolin.
Intel says the next step is mediation, where Globalfoundries is brought to the table. If this doesn't resolve the issue, then they would both be off to the races and the lawsuits would begin [source cnet].
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