Analysis: Intel, AMD end a bitter business and technical battle

Intel still faces legal issues, but AMD can now move ahead

The settlement reached today by Advanced Micro Devices Inc. (AMD) and Intel may not simply resolve some of the business issues the two companies have had; it might even encourage them to cooperate on some shared technical issues, say analysts. In fact, Intel's $1.25 billion payment to AMD may, in the end, turn out to be only a small part of what the accord delivers.

Until now, the relations between AMD and Intel have often dripped with hostility as the two chip makers fought on both a business and technical level, at least according to AMD's allegations. AMD had charged that Intel designed its compiler "purposely to degrade" an application's performance when it ran on an AMD platform. Intel denied that charge.

During a conference call earlier today, AMD chief legal counsel Tom McCoy said the settlement covers certain technical practices, and he cited the compilers in particular. McCoy noted that the agreement will keep Intel from artificially impairing its products.

In seeking these technical agreements, AMD wasn't looking for Intel's help, said McCoy. "Intel has no obligation to help us; they have an obligation not to do things that are simply designed to hurt us," he said.

But AMD and Intel may find it advantageous to help each other, said Martin Reynolds, an analyst at Gartner Inc. He believes that the settlement will lead to improved cooperation between Intel and AMD on x86 platform issues and faster advancement of virtualization improvements on this shared architecture.

Virtualization is still relatively inefficient when it comes to I/O, said Reynolds. With that in mind, "a common standard that makes virtualization more efficient at the I/O level would move it forward," Reynolds said.

The two companies have an incentive to make the x86 platform as attractive as possible, particularly as vendors try to convince customers to upgrade as the economy recovers from its deep dive.

"Both companies had incentives to settle," said Shane Rau, an analyst at IDC. The PC and server markets are starting to recover "and getting this lawsuit out of the way now removes that distraction."

AMD gains the most, say analysts, because it can focus on its product line rather than trying to navigate whatever obstacle course it believes Intel set before it.

"It sounds like AMD will now be able to get its products to its customers and they will be free to introduce those products gated only the by ability of AMD and its partners to execute," said Nathan Brookwood, an analyst at Insight64 in Saratoga, Calif.

Intel still faces a new antitrust case filed by New York Attorney General Andrew Cuomo and a probe by the U.S. Federal Trade Commission (FTC). Neither is expected to be affected by the Intel-AMD deal.

Michael Salinger, a former director of the FTC's Bureau of Economics and now a finance professor of Boston University School of Management, said the AMD settlement is unlikely to have any bearing on the FTC investigation.

"Ultimately, what the antitrust authorities care about is consumers, so peace between competitors doesn't necessarily resolve the antitrust issues," said Salinger.

Join the Good Gear Guide newsletter!

Error: Please check your email address.

Tags AMDintel

Our Back to Business guide highlights the best products for you to boost your productivity at home, on the road, at the office, or in the classroom.

Keep up with the latest tech news, reviews and previews by subscribing to the Good Gear Guide newsletter.

Patrick Thibodeau

Computerworld (US)
Show Comments

Essentials

Lexar® JumpDrive® S57 USB 3.0 flash drive

Learn more >

Microsoft L5V-00027 Sculpt Ergonomic Keyboard Desktop

Learn more >

Mobile

Lexar® JumpDrive® S45 USB 3.0 flash drive 

Learn more >

Exec

Lexar® Professional 1800x microSDHC™/microSDXC™ UHS-II cards 

Learn more >

HD Pan/Tilt Wi-Fi Camera with Night Vision NC450

Learn more >

Audio-Technica ATH-ANC70 Noise Cancelling Headphones

Learn more >

Lexar® JumpDrive® C20c USB Type-C flash drive 

Learn more >

Budget

Back To Business Guide

Click for more ›

Most Popular Reviews

Latest News Articles

Resources

PCW Evaluation Team

Michael Hargreaves

Windows 10 for Business / Dell XPS

I’d happily recommend this touchscreen laptop and Windows 10 as a great way to get serious work done at a desk or on the road.

Aysha Strobbe

Windows 10 / HP Spectre

Ultimately, I think the Windows 10 environment is excellent for me as it caters for so many different uses. The inclusion of the Xbox app is also great for when you need some downtime too!

Mark Escubio

Windows 10 / Lenovo Yoga

For me, the Xbox Play Anywhere is a great new feature as it allows you to play your current Xbox games with higher resolutions and better graphics without forking out extra cash for another copy. Although available titles are still scarce, but I’m sure it will grow in time.

Kathy Cassidy

STYLISTIC Q702

First impression on unpacking the Q702 test unit was the solid feel and clean, minimalist styling.

Anthony Grifoni

STYLISTIC Q572

For work use, Microsoft Word and Excel programs pre-installed on the device are adequate for preparing short documents.

Featured Content

Latest Jobs

Don’t have an account? Sign up here

Don't have an account? Sign up now

Forgot password?