Forget AMD, Now Nvidia Talking To The FTC About Intel

Intel may have ended its legal battles with Advanced Micro Devices, but now federal antitrust authorities have reportedly widened their probe of the chip giant's business practices to include its dealings with graphics chip maker Nvidia.

Representatives of Nvidia have spoken with the Federal Trade Commission about Intel, a spokesperson for Santa Clara, Calif.-based Nvidia confirmed Friday. Intel, also headquartered in Santa Clara, settled several major legal disputes with AMD in November and agreed to pay its smaller rival $1.25 billion in return for an end to AMD antitrust lawsuits brought against Intel in the U.S., Europe and elsewhere.

That settlement also ended a dispute over the two companies' cross-license agreement to produce x86-compatible products, with Intel and Sunnyvale, Calif.-based AMD extending their agreement for another five years.

An Intel legal spokesman said that Intel has had discussions with FTC officials following the AMD settlement but would not comment on whether Nvidia came up in those talks.

"There's an ongoing investigation at the FTC. We've been pretty open that we've been talking to them since the AMD settlement and that we answer any questions that come up," said Intel's Chuck Mulloy.

The FTC has not commented on its investigation of Intel but may be preparing to publicly state its findings, according to media reports. Intel has been charged with antitrust activity by New York Attorney General Andrew Cuomo in a federal complaint filed in November, and was fined $1.45 billion by European Union antitrust regulators in May at the conclusion of a years-long investigation into the chip giant's rebate practices.

Nvidia, meanwhile, has not charged Intel with anti-competitive practices in any global venue, but the graphics chip maker is embroiled in an ongoing legal dispute with Intel over Nvidia's license to sell motherboard chipsets for Intel's latest-generation microprocessors.

Intel claims its 2004 patent-licensing agreement with Nvidia does not allow Nvidia to make chipsets that are compatible with Intel's newest central processors, which feature a different bus architecture than previous generations of Intel CPUs. Formerly codenamed Nehalem, this microarchitecture is featured on Intel's Core i7, Core i5 and future Core i3 chips for PCs and Xeon-branded CPUs for servers and workstations.

That dispute is being heard in Delaware court and in the meantime, Nvidia has suspended its production of chipsets for Intel's Nehalem-class CPUs pending the outcome.

But Nvidia's discussion with the FTC more likely focused on Intel's marketing of another family of products, its Atom chips for low-power, lightweight netbooks, nettops and mobile Internet devices, according to a source close to the matter.

With Atom, Intel owns the lion's share of the market for CPUs powering netbooks, one of the fastest-growing product categories in high-tech over the past two years. Intel also produces its own motherboard platforms and integrated graphics chipsets for Atom-based systems.

Nvidia's competitive product for netbooks and nettops, a hardware platform called Ion, can use Atom CPUs but replaces Intel's onboard graphics with Nvidia's GeForce 9400M chipset.

In May, Nvidia CEO Jen-Hsun Huang accused Intel of engaging in two-tiered pricing of its Atom chips with the result that Nvidia's Ion product was not able to "compete and serve" the netbook market on even footing. Huang claimed that it was "unfair" that Intel at the time was pricing its Atom processors at $45 apiece on their own but charging just $25 when purchased along with Intel's graphics chipset and platform for netbooks.

"We compete fairly in this market segment as we do in all of our market segments," an Intel spokesperson said in response to Huang's statements at the time.

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