When you look at the NVIDIA earnings small detail in their financial statements really impressed us – NVIDIA per quarter in recent years get $66 million in licensing fees from Intel, this amount of money is good enough to give the huge boost and NVIDIA’s quarter net profit reached to $193 million, however, this licensing fee can account for one-third of their net profit, when bad times arrive NVIDIA even half of the net profit from the Intel license fee.
Reopen: Why NVIDIA gets $66 million per quarter from Intel? AMD’s it?
Why this has happened? The causes and consequences of this matter is not a small story between mother and child – it’s a long story, dating back to the cause of what was up for more than a dozen years ago, when AMD has not acquired ATI, ATI and NVIDIA are still doing chipset, Intel in X86 has an invincible market share, but fame sucks, the famous “rebate policies” enable manufacturers to love and hate.
We will not put our ass in this story too deep. Intel is not domineering from half past one thing, AMD even in the era of Intel P4, but also the most disappointing is praised by the Intel X86 market equally hopeless.
Intel, a dominant cause of their monopoly on the X86 market, coupled with the Intel tricks constantly – who else can get the rebate processor family, money and even sell products than the manufacturers and retailers also earned more and Intel compilers better performance on its own processor, everyone suspected shady, but have not seen who find evidence of dark Intel & AMD.
Intel and AMD’s antitrust (Of laws and regulations) settlement
AMD later worldwide for Intel launched an antitrust lawsuit, or we can say it was from both two sides. By the end of 2009 the two sides reached a settlement agreement, AMD abandons all litigation and one-time compensation of both sides to settle litigation and patent licensing dispute, within 30 days to pay the money in cash to the AMD. Of course, Intel promised not to restrict manufacturers and retailers to sell only Intel processors with rebates, etc., while the release of AMD’s X86 authorization no longer require their own manufacture AMD X86 processors, so then we can successfully put AMD fab operational independence and become a fabless semiconductor company.
Intel and the FTC Reconciliation Commission
After reconciliation, AMD and Intel’s trouble does not end, the US Trade Commission FTC also involved in the investigation and ultimately settled in the end of July 2010, the FTC’s main appeal is to release Intel restrictions, so that other manufacturers also have the opportunity to manufacture X86 processors, as well as opening up the compiler, allowing software vendors to use non-Intel compiler software (so AMD processor will also get more benefits from applications), but also prohibits Intel’s little things, such as the case with AMD reconciliation rebate policy and so on. The agreement can now be found in Intel’s official website.
The FTC’s starting point is to maintain competition in the market, which vary with the EU. Also, antitrust, but in the EU fined Intel $ 1.45 billion also due to the monopoly of Microsoft fined 500 million euros by the European Union and more than once.
Intel and NVIDIA’s antitrust settlement
Intel finished in front of AMD. In fact, in the settlement of the FTC case NVIDIA has benefited, but they told Intel eventually have a separate lawsuit. There was NVIDIA chipset business and doing quite popular, but Intel in PCI-E always depends on the DMI bus card with third-party vendors, which allows third-party chipset manufacturers to manufacture it.
Eventually, Intel and NVIDIA in January 2011 reached a settlement agreement, Intel agreed to $ 1.5 billion to settle lawsuits on the two sides and authorized the NVIDIA graphics technology, such as SLI and so on. (Theoretically, two PCI-E slots can support SLI)
Intel seems to be losing money to settle a lawsuit NVIDIA, but managed to keep the basic disk, including the FTC, including requirements for Intel X86 release authorization, in the introduction of full competition Intel refused all demands, their attitude is willing to “willful” lose money, But others want to divide X86 market which was is impossible, so Intel’s $ 1.5 billion compensation does not care whether the access to technology licensed NVIDIA, NVIDIA contrary therefore completely out of the chipset business, but did not wish to encroach on the X86 processor and this money be compensated to Intel broke up.
Intel 1.5 billion compensation that is paid in installments from 2011 to 2016 a total of five years, detailed protocol can also be found on the Intel official website.
In short, in two years that the antitrust case in concentrated outbreak, Intel settled with money AMD, NVIDIA and other manufacturers for Intel, as long as money can be used to resolve the matter is not a thing, other manufacturers have to weigh, reconciliation did not take the money much better choice to continue a delay would only cheap lawyer.
NVIDIA chose to be paid in installments, so the five-year quarterly earnings can be a little original compensation is less than $ 1.5 billion in installment payments to calculate interest.
PS: Intel antitrust settlement has been reported in the past several years, “gravedigger” inevitably there are some mistakes in this article, but the context of the story is clear.