Intel's lawyers are evaluating whether a new manufacturing business spun out of AMD could end a long-standing cross-licensing agreement between the firms. On Tuesday, AMD announced plans to spin off its manufacturing operations into a separate company tentatively called The Foundry. The restructuring lets struggling AMD rid itself of the financial burden of running fabrication plants and provides a hefty influx of cash from its partner in the deal, Advanced Technology Investment Co. (ATIC).
Now, rival Intel is throwing a flag on the play. "We certainly have to evaluate it," said Intel spokesman Chuck Mulloy. "It certainly could be a change in the competitive landscape." Mulloy explained that Intel and AMD have licensed each other's patents since 1976. Among other things, the latest pact signed in 2001 calls for AMD to pay royalties to Intel for the use of its x86 architecture.