Intel, Nvidia ends legal battle with $1.5 billion cross-licensing deal

Intel and Nvidia announced Monday they are dropping their respective lawsuits with the signing of a six-year agreement to exchange patent rights. Under the deal, Intel will pay Nvidia $1.5 billion for the right to use the latter’s graphics processing units technology. Intel will pay the amount in five annual installments starting on Jan. 18, according to Nvidia.

“This agreement ends the legal dispute between the companies, preserves patent peace and provides protections that allow for continued freedom in product design,” said Doug Melamed, Intel senior vice president and general counsel. “It also enables the companies to focus their efforts on innovation and the development of new, innovative products.”

"This agreement signals a new era for Nvidia," said Jen-Hsun Huang, Nvidia's president and CEO. "Our cross license with Intel reflects the substantial value of our visual and parallel computing technologies. It also underscores the importance of our inventions to the future of personal computing, as well as the expanding markets for mobile and cloud computing."

Both companies are based in Santa Clara, Calif. One of Intel's largest chip manufacturing plants is in Rio Rancho, N.M., just northwest of Albuquerque.