For Intel, the settlement with AMD means
it can focus on areas where it sees its greatest growth potential, outside of
the traditional PC and server markets, analysts said. Intel has made no secret of
its desires to expand in such areas as netbooks, consumer electronics, handheld
devices and graphics.
"In five years, 98 percent of Intel's revenues won't be coming from
server and PC processors," Spooner said.
Jack Gold, an analyst with J. Gold Associates, said Intel's biggest concern
these days is not AMD, but ARM
and its various licensees-including Qualcomm, Texas Instruments and Freescale
Semiconductor-that dominate the mobile space.
"While PC and server chips are its breadwinner today, Intel rightly
understands that the sheer number of personal and consumer intelligent
computing devices that will be built over the next several years will far
outnumber the traditional PC marketplace," Gold wrote in a report.
"These devices-smartphones, netbooks, Mobile Internet Devices, home
entertainment, smart appliances, personal entertainment, smart power devices, smart
autos, and on and on infinitum ... all connected to the Internet-are not
currently the domain of Intel and its x86 architecture."
This poses a risk to Intel, which is why the vendor is spending so much
money and effort on its Atom platform, Gold said.
Still, before Intel moves too far into the future, it needs to deal with
other legal issues surrounding its business practices. Intel
is appealing a $1.45 billion fine
levied by the European Commission in May,
and now has to deal with the New York
The settlement also may have allowed Intel to dodge another complaint that
analysts had been expecting from the Federal Trade Commission.
Otellini said he was hopeful the AMD
settlement would "bring some comfort to regulators." Endpoint's Kay
said the established cases, such as the one out of Europe,
would probably have to run their course. As far as the newer ones, such as the New
York lawsuit, they may go away pretty quickly now
that the AMD deal is in hand, he said.
There still are a few lingering issues to be worked out around pricing, both
The deal also ensures a relatively healthy AMD,
which Intel needs to fight off further claims of a processor monopoly.
The Computer and Communications Industry Association, which has been a vocal
critic of Intel's business practices, applauded the deal.
"While there is unfortunately no explicit admission of wrongdoing by
Intel, perhaps understandably in view of its continuing legal challenges, the
facts that have been made public and the size of the settlement [leave] little
doubt about culpability," Ed Black, president and CEO
of CCIA, said in a statement. "We nevertheless hope this settlement
signals a firm commitment from Intel to stay focused and to compete on the
merits of their products, not their power in the marketplace."