In 2009, a cross license agreement was signed between AMD and Intel. At that time, the agreement was made for AMD in the periods that were not very good. However, the same agreement is now on the agenda again in a very challenging period of Intel. Apparently, AMD can prevent the possible sales or division of Intel, which has gone through the most troubled processes in its history.

In the last few years, Intel has faced serious financial and operational challenges, which has led to many speculation about the future of the company. The latest rumors were that Broadcom was willing to take over Intel’s product business. In fact, it was reported that TSMC was interested in Foundry, the chip production facilities of Intel. However, there is an obstacle that most people ignore: a large -scale cross license agreement between Intel and AMD.

License agreement in front of Intel’s sale

AMD and Intel have a long -standing cross license agreement. This agreement allows both companies to use each other’s patents, so that they are prevented from suing each other for potential patent violations. This agreement contains a very large portfolio (CPU, GPU, FPGA, etc.). For example, AMD can design microprocessors compatible with Intel’s X86 command set architecture, while developing processors using Intel de AMD’s IPs.

However, this agreement also has some limits. Both companies have to avoid producing processors compatible with the infrastructure of their opponent (such as processors compatible with the same socket or motherboard).

On the other hand, according to the agreement between AMD and Intel, if one of the two companies changes, the agreement is automatically invalid. This is valid if the merger of companies, a partnership, or if one is purchased by another company. When such a change takes place, it is necessary for companies to make a new license agreement. Considering the extremely deep and extensive scope of the license agreement, we can say that almost all of AMD and Intel’s products can be affected. This can be destructive for both companies. This may even be the last nail that crashed into the X86’s coffin. Because AMD and Intel have two companies and another player who controls the present and tomorrow of the X86. (Remedy Reading suggestion: Intel and AMD combine their powers to save X86)

History usually repeats

If you remember the 2010s when the sale of AMD is on the agenda, you can remember the news titles that Intel can make the process difficult with this agreement. Now the date seems to have repeated, but the parties have changed.

However, it is a big question mark whether AMD is really willing to sit at the table with Broadcom and make a new agreement. In the past, Broadcom was known for its network solutions and wireless technologies, but today the company has become an important player in storage, cyber security and infrastructure software markets. Moreover, Broadcom, who wants to acquire CPU capabilities by collaborating with large cloud service providers about the development of special AI processors, can be a serious opponent for AMD.

Today, the fact that Broadcom is equipped with both CPUs and AI processors will pose a larger threat of competition than Intel for AMD. Because Intel’s AI strategy is not yet clear. Broadcom’s aims to strengthen itself in the data center market rather than helping AMD against Nvidia domination in the AI ​​market. Broadcom, which will receive the general purpose data center processor processor supported by Intel’s large desktop PC processor volume, will probably focus on improving its own AI data center platform.

In the meantime, it should be emphasized by underlining this; The cross -license agreement does not allow any aspects to prevent activities such as purchasing directly. So both AMD and Intel can be divided and purchased as they wish, but it has to endure the results. The “blocking” discourse here refers to the difficulties that will arise as a result of such a change of ownership. Because the reconstruction of these license agreements may even be more costly than the purchase itself. In this scenario, AMD may make strategic requests from Broadcom, including a financial payment.