Legal Sanctions Seen as Intel Pays Settlement of $1.25 Billion to AMD

After Intel Corp. agreed to pay $1.25 Billion to Advanced Micro Devices Inc. (AMD) Thursday to end years of dispute, the European Union, the New York State Attorney General and the US Federal Trade Commission (FTC) are already hot on their

The settlement settled anti-trust litigation and patent disputes by implementing a five-year cross-license pact and give up claims of breach. Intel also stated that they will now abide to a set of business-practice provisions including making discounts conditional on customers buying exclusively Intel microprocessors. AMD will withdraw all of its regulatory complaints against Intel.

Intel currently holds 70% of the PC processors market while AMD holds almost the remaining 30%. A third player Cyrix folded in 1997. The agreement between the two remaining competitors is being viewed as a monopoly-dominating factor of the market. This is what various governing bodies are worrying about. Legal sanctions are being checked.

The FTC meanwhile, is still not satisfied with some of Intel’s practices like giving retroactive volume-based discounts. It still wants to continue its investigations regarding the claims of AMD that Intel had abused its dominance in the billion-chip market even if AMD is already withdrawing them as a result of the settlement.