AMD may prevent Intel’s sale for licensing agreement

Recently, rumors began to emerge on the possible sale of part of Intel’s chip business to Broadcom, a giant from the network and technology industry. However, an important factor and often ignored by analysts can complicate this negotiation: the cross licensing agreement between AMD and Intel, which includes several fundamental patents for the two giants of technology.

Such a cross licensing agreement

Intel and AMD have maintained a cross -licensing agreement since 2009, allowing both companies to use each other’s patents, ranging from X86 processors and their extensions such as SSE and AVX to GPUS, DPUS and FPGA innovations. This agreement ensures that companies can develop and market their products without being involved in legal disputes for patent violations.

However, there is an important clause in this agreement: If one of the companies is acquired or joins a joint venture that changes its property, the agreement is automatically terminated.

This means that if Intel founded with Broadcom or involved in any transaction that altered its ownership structure, it would need to renegotiate licensing terms with AMD.

Otherwise, the two companies would lose the right to use each other’s patents, which could seriously affect their product lines, such as processors and GPUS.

Consequences for Intel and AMD

Although the possibility of a fusion between Intel and Broadcom generates speculation, as discussed even in the sale of 20% of the Intel Chip segment to TSMC, the company’s financial impact remains increasing, as recent Intel growth data indicates Beginning of 2025, so a break in the agreement with AMD could be devastating to both parties.

Another crucial point is the role of Broadcom, which has expanded beyond its roots in networks and telecommunications to also include the storage, cybersafety market and infrastructure software.

If the Licensing Agreement between AMD and Intel is broken, this would force a renegotiation that could directly impact the competitiveness of the two companies, especially in a scenario where Broadcom assumes an increasingly strategic position in the market

The company is already one of the main developers of Custom AI processor processors and is collaborating with cloud computing giants. Broadcom’s entry into the General CPUS market, if it occurs through the acquisition of Intel, would make the company an even stronger competitor for AMD, especially in markets such as Data Centers, where Intel is losing ground.

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The situation involving the possible sale of Intel to Broadcom illustrates how strategic agreements, such as cross licensing between AMD and Intel, may have unexpected implications on the technology market.

It now remains to see how these elements unfold, and if AMD, in fact, will exert its veto power or whether a solution will be found.

Fonte: Digits to Dollars

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