Intel/Nvidia Catfight Is About More Than IP

ci7x_78Intel (s INTC) on Monday night filed suit to stop graphics chipmaker Nvidia (s NVDA) from tying its graphics chips to certain future Intel CPUs. The suit filed in the Delaware Court of Chancery alleges that Nvidia doesn’t have the right to integrate a Nvida GPU with future Intel processors, such as the high-end Core i7 chip code-named Nehalem, under a current licensing agreement between the two companies. The sealed suit also seeks to get Nvidia to stop telling its customers it can integrate its GPUs with certain Intel chips, an alleged breach of the agreement.

Apparently the two chipmakers have been fighting over this issue for a year, and Intel finally decided to take it to the courts to decide. Intel spokesman Chuck Mulloy says the suit has nothing to do with current Nvidia products such as the ION platform, which combines an Intel Atom processor with a Nvidia GPU, but whether or not Nvidia can tie its chips to Intel processors that contain integrated memory. Right now that means Intel’s Core i7 processor.

“We want the court to determine the rights of the parties under the agreement,” says Mulloy. “We have one view and they have another. We hope that this dispute doesn’t impact other areas of the companies’ working relationships.”

It looks like Nvidia’s attacks on the CPU and its efforts to push the GPU for general purpose computing are bearing fruit, since this is the first time Intel’s PR battle against Nvidia has made it to the courtroom. Industry watchers have wondered if Intel might try to stop Nvidia or netbook OEMs from using the ION platform, which might cut into higher-end Intel chip sales by creating a more notebook-like experience on the Atom chip.

Intel can’t stop Nvidia on all fronts, but it hasn’t been one to take its intellectual property or its near monopoly in x86 chips for granted — even if x86 computing is losing its ubiquity.  This looks like one way Intel is circling its wagons as PC sales drop, GPUs gain prominence, and it finds itself fighting for mobile market share against chipmakers pushing ARM-based (s ARMH) chipsets.