U.S. chipmaker giant Intel said Monday it had agreed to pay graphics card developer NVidia 1.5 billion U.S. dollars to resolve a patent dispute between the two companies.
The two companies have been arguing for almost two years over the terms of a 2004 agreement under which Intel granted NVidia access to some of its technology for use in its chipsets, chips that help the microprocessor and the graphics chip talk to each other.
Intel sued NVidia in February 2009, alleging that the latter should pay for a new license to make chipsets that were compatible with Intel's latest processors. NVidia countersued a month later, saying it had a license under the 2004 agreement.
According to Intel's press release, the two companies have entered into a new comprehensive long-term patent cross license agreement, under which each will receive a license to the other's patents subject to the term of the agreement, and Intel will pay NVidia 1.5 billion in licensing fees over the next five years.
"This agreement ends the legal dispute between the companies, preserves patent peace and provides protections that allow for continued freedom in product design," said Doug Melamed, Intel senior vice president and general counsel.
NVidia president and chief executive officer Jen-Hsun Huang said: "This agreement signals a new era for NVidia. Our cross license with Intel reflects the substantial value of our visual and parallel computing technologies.
"It also underscores the importance of our inventions to the future of personal computing, as well as the expanding markets for mobile and cloud computing," he said.
The two companies dominate different areas of the chip industry. Intel focuses on microprocessors and NVidia on graphic chips. The rise of smartphones and tablets has put new competitive pressure on the two in providing lower-power chips with higher graphical performance.
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