In 1999, after Cyrix was purchased, Wen-chi Chen, the Head of VIA and former manager at Intel, said that Intel had legal proceedings with Cyrix 5 times and never won. They just like trials.
In 1999 VIA, the only competitor of Intel, which didn't get the licence for the P6 bus released its new chipset - Apollo Pro133 which used a memory standard actively promoted by VIA and by the rest of the industry - PC1333 SDRAM, unlike the i820 chipset which used an expensive RDRAM. It was clear that the chipset would be a hit long before sales, and Intel declared at that time that the chipset infringed its intellectual property rights and mustn't be released.
Nevertheless, VIA launched the Apollo Pro133, and it was warmly accepted by board makers. The release, however, was followed by the Intel's suit. First of all, against VIA and then against several its clients, including such a huge board manufacturer as FIC. As a result, soon both companies compromised - VIA paid some smart money to Intel and both companies concluded closs-licensing which legalized the Apollo Pro133, which helped VIA to become a leader on the chipset market.
The historic event repeat, however. Two years later...
...VIA, the only competitor of Intel, which didn't get a licence for the Quad Pumped Bus, released its new chipset, P4X266 which used a memory standard actively promoted by VIA and the rest of the industry - PC2100 DDR SDRAM, unlike the i845 which used an aging slow SDRAM. It was clear that the chipset would be a hit long before sales, and Intel declared at that time that the chipset infringed its intellectual property rights and mustn't be released.
Nevertheless, VIA launched the P4X266, and it was warmly accepted by board makers. The release, however, was followed by the Intel's suit. First of all, against VIA and then against several its clients, including such a huge board manufacturer as Elitegroup. As a result, soon...
<Q>: Hello! Thanks a lot that you agreed to answer our questions. Could you please introduce yourself to our readers?
VIA: My name is Richard Brown. My title is Director of Marketing at VIA Technologies, Inc.
<Q>: Why do you think Intel - beginning from P6 - decided to cover their bus technologies with paid licenses?
VIA: I think you should ask Intel that question! Open standards have played an incredibly important role in driving the growth of the PC industry over the past twenty years. Closing them off only serves to stifle innovation and hold back future technological development. You don't hear AMD talking about a paid Socket A license; they are happy to work with all chipset vendors to maximize the number of solutions available and encourage innovation on the platform. The competition is good for everyone.
<Q>: What does it mean for an average end-user, that the new P4X266 chipset started shipping without Intel's license?
VIA: The "legal marketing" tactics adopted by Intel have created unnecessary and unjustified FUD (Fear, Uncertainty, and Doubt) in the industry, and are now the subject of a petition we have filed in Taiwan under the island's Fair Trade Law. We are examining the complaint that Intel has filed in the US against the P4X266; but given Intel's history of using litigation to obtain market advantage we are skeptical of its merit. As a result, this shouldn't affect the end user.
<Q>: Intel emphasizes that royalties for P4 bus licensing are very low: they do not expect to make money from them but rather receive appreciation to their R&D in this field. If it is like that, why shouldn't you officially license the P4 bus?
VIA: The issue here is not at all connected to the size of the royalties. It's about mutual respect for the technology and innovations of both companies. VIA has a broad base of technology and businesses where we own significant intellectual property assets. These should be respected.
<Q>: Let's move now to the legal activities. Last time, despite using all possible means, Intel didn't make it to get with their case to the end and decided on cross licensing and out of court settlement. Why didn't Intel pursue the case till the end? Was it because Intel didn't believe in their strength, or maybe VIA was too strong, or was it something else?
VIA: Unfortunately, I can't comment on this.
<Q>: What are the perspectives for the current legal action? What is the best outcome for both sides and for the industry?
VIA: It's very important to point out here that VIA is not by nature a litigious company. Intel, in contrast, has a long history of dragging competitors such as AMD and Cyrix through the courts. Intel should realize, however, that this is a battle we are fully prepared to fight.
Right now, the PC industry is experiencing negative growth for the first time in many years and the transition to the Pentium 4 has been slowed by the lack of appropriate platforms. VIA provides that with the P4X266 and DDR. I don't think it's too difficult to work out what would be the most beneficial outcome for everyone.
<Q>: To which extent the IP received through S3 Graphics and Cyrix secure VIA position? According to you, can VIA really be safe from all claims from Intel?
VIA: VIA has developed an extensive portfolio of high quality patents through internal innovation and acquisitions, but I cannot comment on the specifics. As I mentioned above, we believe that the complaint Intel has filed against us is without merit and we will vigorously defend against it.
<Q>: As a response to Intel's action, VIA announced that P4 and i845 chipset infringe on VIA patents. Could you clarify to us, which VIA patents have been infringed on? Are these Exponential patents or some other?
VIA: We filed to protect our Intellectual Property rights - not in response to Intel's actions. We have filed two patent infringement claims against Intel.
As you can see, neither of these patents is from Exponential.
<Q>: Would the fact that P4X266 is "illegal" delay its introduction to the market? To which extent the demand would be affected? Do you think that Intel will have some sanctions against motherboard vendors which decide to use your chipset?
VIA: The P4X266 is not in any way an " illegal" product. Demand for the P4X266 is very strong and some motherboard makers are already shipping it. The reason for this is simple: the P4X266 provides the best solution for the Intel Pentium 4 processor.
<Q>: P4 license has not been granted to two potentially strongest chipset players: VIA and nVIDIA. Is this because Intel is afraid or is too ambitious?
VIA: Again, I cannot comment on Intel's specific motives. As I mentioned in the first question you asked me, vigorous competition based on open standards has been one of the most important factors behind the growth of the PC industry and indeed Intel over the past twenty years. Reduced competition only serves to stifle innovation which in turn leads to industry stagnation. It's that simple. Right now, all of us need to be looking at ways of putting the excitement back into the PC. That's what VIA is about.
End of interview.
Thank you for your answers. I just hope that the common sense will dominate: it is clear that neither Intel is interested in holding back sales of P4X266, nor VIA is interested in hampering the Pentium 4 sales. Although the situation is very similar to the previous one that took place 2 years ago (except the counter-suit of VIA and other minor aspects) I can't say the affair will have the same outcome. The time will show what approach will be chosen by Intel and VIA. However, it looks like that VIA will get the licence for QPB from Intel. And this will be a right solution since it is not the money that matters for Intel most of all, but they are eager to provide respect for their intellectual property, for millions of dollars and for man-hours invested into new architectures. And it is important for Intel that VIA admits it. And an issue of money won't be hard for them to agree upon.
On the other hand, we understand VIA as well, especially
when they talk on a use of open standards. You probably remember
two IBM buses - an open ISA and a closed MCA, which one survived
and which architecture helped IBM to become a leader in its sphere
- the open IBM PC AT or the closed IBM PS/2.
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