NYT: Nvidia will sell x86 chips, and the FTC suit could help

— 3:30 PM on December 21, 2009

Could Nvidia really launch an x86 processor and start competing with Intel on its home turf? An analyst resurrected that rumor after a long dry spell last month, and The New York Times' Bits blog has now jumped on the bandwagon, pointing out interesting new details in the process.

Times blogger Ashlee Vance got tips from industry sources who say "it's an open secret that Nvidia has been working on just such a chip since 2007." The graphics company's R&D costs have skyrocketed from $352 million in 2006 to $856 million last year, and LinkedIn reportedly shows "at least 70" former employees of Transmeta, a defunct x86 CPU maker, now on Nvidia's payroll—evidence of what that analyst talked about last month.

Some of those staffers could have joined Nvidia for other reasons, sure, but a large number of them are x86 test and verification engineers. David Kanter of Real World Technologies told the Times those are highly specialized engineers who make sure x86 designs behave just like AMD or Intel processors. Kanter added, "The expertise to validate and test an x86 is incredibly specific and only useful to a few companies . . . Some of that expertise can transfer to other areas, but it's a lot like having a Formula 1 racer driving a taxi cab."

So, the writing is on the wall. The Times believes Nvidia would need about four years and a billion dollars to get an x86 processor up and running, which could place that in the 2011 time frame. There's one little snag: the firm currently lacks an x86 license from Intel. Here, the Federal Trade Commission's recent lawsuit could play a part.

According to the New York Times, "relief measures" proposed by the FTC would force Intel to "make available technology (including whatever is necessary to interoperate with Intel's CPUs or chipsets) to others, via licensing or other means, upon such terms and conditions as the Commission may order, including but not limited to extensions of terms of current licenses." The FTC would also prohibit Intel from forbidding x86 licensees to change ownership, outsource production, or "otherwise partner with third parties to expand output."

Intel CEO Paul Otellini alluded to the measures in last Friday's interview with Fox Business Network, saying, "[the FTC is] asking us to mandatorily license the technology that we develop to our competitors." The FTC's complaint won't be heard before a judge until next September, though, so even if the FTC prevails, Nvidia may not be able to use that avenue immediately.

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