Intel Sues VIA

Posted By Van Smith

Date: September 9, 2001

Chip titan Intel is attempting to sue Taiwanese chipset maker VIA Technologies over the maverick P4X266 chipset.

A copy of the complaint filed in a Delaware federal court can be found at The Inquirer.  Within this document can be found disclosures revealing former actions the Santa Clara semiconductor giant has taken against the upstart core logic producer:

15. Intel previously brought a patent infringement action against VIA before the United States International Trade Commission, Investigation No. 337-TA-428 (the "ITC action"). The ITC action has been dismissed.

16. Intel has also previously asserted foreign patents against VIA in various foreign proceedings (the "Foreign actions"). The Foreign actions have been dismissed.

The dismissed ITC action cited above is described in a CNET piece written soon after Intel lodged that complaint.  Also, a previous action from Intel in 1999 closely mirrors the tenor of the current suit:

Intel is filing the suits to protect its intellectual property, according to spokesman Chuck Mulloy. "Via does not have a license to the 'P6' bus," he said, referring to the data pathway that connects Intel processors and peripheral components, such as chipsets or memory.

The current Intel complaint seeks damages as well as a permanent injunction against VIA and its P4 related chipsets, the P4X266 and the P4M266.

VIA owns the graphics controller division of the company S3 along with its extensive cross-licensing agreements with Intel.  According to a TechWeb article produced at the time the S3-Intel arrangement was announced, the ten-year deal involves all patents from S3 and Intel "regarding the development of certain semiconductor products" and appears to specifically include "a bus license for current and future Intel processors."  A Pentium 4 bus license is key to the current dispute.

Prior to the S3-Intel cross-licensing agreement, S3 won crucial patents from the defunct MPU designer Exponential that some speculated would result in a suit against Intel who seemed to be violating some of Exponential's patents with the Merced (now called Itanium). 

Instead of litigation, the aforementioned cross-licensing agreement appears to have been the result of Exponential's valuable IP obtained by S3.   Intel originally sought to own the Exponential patents outright, but failed.

Exponential designed high-speed PowerPC processors before collapsing into bankruptcy.  The company was highly lauded for its technical expertise.

Intel only recently opened up the market to core logic controllers, but has been suffering rapidly since.  According to a CNET article dated in March of 1999, Intel began issuing bus licensing for the Pentium II after pressure from the FTC:

Intel also seemingly became more open with its technology licensing. In the past three months, Intel has licensed the "P6" system bus to three other chipset vendors. The license essentially opens up the market for Pentium II chipsets, which Intel has had a monopoly on, to other vendors. These vendors will pay royalties to Intel, but competition will grow, said analysts.

Also at the time of the FTC investigations, OEMs became more receptive to chipmaking rival AMD:

The attitude began to change after the FTC first announced it was investigating the company's business practices in September 1997. Coincidentally or not, nearly all of AMD's design wins with major computer manufacturers occurred after the FTC announced its investigation.

The VIA P4X266 is a new chipset that enables the use of DDR SDRAM with Intel's Pentium 4 processors.  This VIA chipset has been previewed with widespread acclaim.  The P4X266 delivers performance comparable to Intel's pricey i850 which must also use unpopular and expensive Rambus RDRAM.  Intel is expected to release a cheaper SDRAM-based solution, the i845, tomorrow, but early reviews have panned the product due to sub-par performance resulting from its use of memory bandwidth deficient SDRAM with the bandwidth demanding Pentium 4 design.

VIA Technologies currently controls approximately 50% of the market share for core logic controllers, making the Taiwanese company the largest producer of chipsets in the world.  VIA's meteoric rise to dominance from relative obscurity has occurred rapidly over the last two years with its success coming largely at the expense of Intel.

An article pronouncing the recent Intel legal actions contains the following old quote from VIA's CEO, Wen Chi Chin:

"Intel sued Cyrix five times, and they never won," Wen Chi Chen, Via's CEO and a former Intel executive, said in 1999. "Intel--they just love lawsuits."


Van's Hardware Journal is an independent Internet publication.  Opinions expressed herein are expressly those of the authors' and do not reflect other parties with whom they may be associated.