Via Licenses Intel's 'Slot 1' Technology

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November 30, 1998 (2:46 PM EST)

By Sandy Chen and Mark Hachman,

Chip set maker Via Technologies announced Monday that Intel has granted the company a license to use Intel's "P6 bus," a technology that Intel has closely guarded.

Under the agreement, Via may build and sell core-logic chip sets for Intel's Pentium II microprocessors using Intel's "Slot 1" architecture. Via will sell certain versions of its Apollo Pro chip set family designed to use the P6 bus, paying Intel a royalty for each one. In addition, Intel has also licensed certain undisclosed patents from Via.

Until now, Via has concentrated on designing and selling Socket 7-class chip sets, the infrastructure of choice for many of Intel's top microprocessor competitors, such as Advanced Micro Devices. The Slot 1 architecture and the associated P6 bus are required to build systems based on Intel's Pentium II processors. Intel has previously drawn fire from industry observers for not publicly licensing the technology.

"The license definitely will help to increase our shipment volume," said Frank Jeng, marketing section manager of Via, a Taiwanese chip set maker whose U.S. operations are based in Fremont, Calif. "It will also help Intel move the microprocessor market to Pentium II."

According to Taiwanese sources, Taiwan's core logic chip set makers, Acer Laboratories and Silicon Integrated System (SIS), also have been negotiating with Intel for the Slot 1 license. A SIS spokesman said the company expected to be granted the license in the near future.

In May, both Via and SIS announced core-logic products based upon the P6 bus, following a similar announcement by Acer in March. However, all three companies had proposed using foundries with an existing cross-licensing agreement with Intel as a means of avoiding any legal quarrels. Such foundries include IBM Microelectronics and National Semiconductor.

For its part, Intel has publicly maintained that it would license its technology in return for "fair value". Shortly after government antitrust investigators reportedly began investigating whether Intel's Slot 1 interface inhibited competition, Intel representatives indicated the chip maker had already granted a P6 license to an undisclosed number of third-party companies.

A spokesman for Intel, in Santa Clara, Calif., confirmed that Via has been granted a Slot 1 license on the Apollo Pro, adding that it applies to certain future products as well. "Our view is that [intellectual property] is an asset, and we try to strike some sort of balance to our satisfaction," he said.

Analysts said it was unclear whether Via will enjoy any special advantage from a formal license. To date, chip set and microprocessor makers alike have been able to manufacture Intel-compatible products at the licensed foundries, according to Dean McCarron, principal at Mercury Research, Scottsdale, Ariz.

In addition, PC original equipment manufacturers that design and build their own chip sets, such as Compaq Computer, can employ a legal defense known as "implied use", McCarron said. Essentially, a purchaser that buys a Slot 1-compatible chip set from Intel has the right to use the corresponding chip set. "It's like buying gasoline -- it's of no use without the appropriate [gasoline-consuming] engine," he said.