Rambus, Intel sign new chip deal

Summary:The companies renegotiate their patent cross-licensing deal and announce a new 5-year agreement.

Intel and memory chip designer Rambus renewed their licensing pact Monday, a move that will likely give the memory company a much needed shot in the arm.

The new agreement, which supercedes the 1996 Intel-Rambus licensing agreement, grants Intel access to Rambus' entire patent portfolio for five years. In turn, Intel has agreed to grant licenses for patents Rambus needs to build memory interface technology.

Intel will pay Rambus royalties of $10 million per quarter, Rambus CFO Bob Eulau said in a conference call with reporters and analysts.

That's good news for Rambus, which has seen turbulent financial times this year. The company has spent millions pursuing patent infringement suits against three memory makers. Meanwhile, many PC makers have indicated they will veer away from incorporating memory based on Rambus designs in favor of standard memory to cut costs.

Rambus is best known for RDRAM, its spin on memory technology for PCs.

However, the company has also developed other memory, communications and networking technologies of late. Intel also gains access to these newer, networking-oriented technologies as part of the new agreement.

"This deal positions us for further success in the chips-connection business," Rambus President Dave Mooring said in the conference call.

When it comes to RDRAM memory, it's business as usual for Intel.

Intel recently added support for standard SDRAM for its Pentium 4 processor. Until then, the company had paired the Pentium 4 with RDRAM exclusively. The new SDRAM-compatible 845 chipset, which connects the processor to other PC components, was designed to help lower the cost of Pentium 4 desktops.

Intel maintains it will continue to support RDRAM on the high end of its Pentium 4 processor line, such as its newest 2GHz Pentium 4 chip. Intel has also said it will add support for a speedier RDRAM alternative, Double Data Rate SDRAM, early next year.

The new agreement "doesn't change our current product road maps," said Intel spokesman Chuck Mulloy. RDRAM "is still the preferred memory technology for high-performance" PCs, he said.

Topics: Hardware

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