Intel, ATI settle lawsuit with patent exchange

What goes around comes around...

Graphics chip developer ATI has entered into a patent cross-licensing deal with Intel - the result of an out-of-court settlement of a pending legal battle between the two companies.

The deal primarily gives ATI the right to create chip-sets that support Intel's CPUs. ATI has been pursuing this area for some time, essentially to build a business serving low-end PC makers and Net appliance manufacturers. The scheme centres on providing chips that integrate audio and graphics technology with North Bridge functionality.

ATI revealed it is working on an integrated chip set back in October when it updated its Radeon roadmap.

For its part, Intel gets access to ATI's graphics and multimedia technology, which, it says, will boost its plan to "to deliver products to customers who are interested in streaming content, playing interactive games, encoding video or creating Internet content".

ATI has been working on a system-on-a-chip product for some time, and it could well be that that Chipzilla is after, particularly given the apparent failure of its own SoC project, Timna. ATI's part is due next Spring.

Details of the agreement where not made public, but we note the final sentence in the joint news release: "This agreement also settles pending litigation between the two companies."

Quite what this refers to, we're not sure. However, we wonder if it has to do with now-defunct graphics chip maker Real3D. It tried to sue ATI for alleged patent infringement back in June 1999, but collapsed before the case could come to court, in October that year. Intel bought up Real3D's patents, and may since have decided there was merit in pursuing the claims against ATI.

At the time, we wrote: "Whether the [patent infringement] case will continue now that Real3D appears to be no more, remains to be seen. Given Intel's vigorous legal team, we suspect it will, doubly so since it would be a handy favour for S3, currently Intel's favourite 3D graphics company and longtime ATI arch-rival."

S3 is, of course, now SonicBlue, and its graphics technology owned by VIA. ATI's arch-enemy is now Nvidia. Nvidia recently bought 3dfx's technological assets. 3dfx's intellectual property included Read3D's graphics patents, licensed from Intel.

Intel already had a relationship with Real3D - the latter developed Chipzilla's i740 graphics system.

At the time, there were a number of industry rumours circulating that alleged ATI had been cherry-picking Real3D's key staff. ®

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