Computer chip manufacturers Intel and NVIDIA have settled a long-running dispute over the use of intellectual property rights. The two companies will allow the mutual use of each other's patents. Intel will pay NVIDIA 1.5 billion U.S. dollars for the deal over the next few years. The settlement of this conflict on patent law is a good illustration of the tremendous value that intellectual property rights represent for these companies.

The agreement puts an end to a long legal battle. The two competitors now have a so-called cross-licensing agreement. This makes it possible for Intel to use technical knowledge from all of NVIDIA’s patents. In return, NVIDIA collects $1.5 billion and is allowed to use Intel's patents, aside from a number of patents for specific processors, chipsets and flash memory.

A few years ago, NVIDIA had obtained the license to use a number of these Intel patents, but disagreements had arisen about the application of Intel technology by NVIDIA. NVIDIA did not agree with Intel’s interpretation of the license agreements, which led the two companies to meet each other in court. Following the new deal, these lawsuits will be discontinued.

Analysts were surprised by the astronomical amount of $ 1,500,000,000 (about 1.16 billion euros) involved with this agreement on the mutual use of patents. At the closing of the stock exchange in New York, the value of NVIDIAs share increased more than 4 percent, according to Dutch newssite Nu.nl.

Source:  Intel Newsroom