FTC to Stay Out of Digital/Intel Settlement

Staff -- Semiconductor International, 6/1/1998

Intel (Santa Clara, Calif.) and Digital Equipment Corp. (Maynard, Mass.) announced that the Federal Trade Commission (FTC) has notified the companies that the commission will not seek to enjoin settlement of the legal dispute between the companies. The settlement includes Intel's acquisition of assets of Digital's Semiconductor manufacturing operations and Intel's role as a foundry for multiple generations of Alpha microprocessors. As part of the FTC review process, Digital agreed to a consent order that provides for the licensing of the Alpha technology to other semiconductor manufacturers.

The settlement was announced Oct. 27, 1997, and was subject to FTC review under provisions of the Hart Scott Rodino Improvements Act. Digital and Intel plan to complete the transaction as soon as possible. The transaction includes the sale of Digital's semiconductor manufacturing facility in Hudson, Mass., to Intel, a cross-license of patents, and an agreement by Intel to manufacture Alpha microprocessors for Digital. In addition, Digital has agreed to develop future systems based on Intel's 64-bit microprocessors.

Digital will retain the Alpha technology, Alpha, and Alpha-related semiconductor design teams to develop future generations of Alpha. Digital will also work with Intel to port its Digi tal UNIX operating system to run systems using Intel's future 64-bit microprocessors and work with Intel and Microsoft to establish a common programming environment for 64-bit applications on Alpha and IA-64 platforms. Also under terms of the agreement, the companies will take appropriate actions to drop the pending litigation's between Intel and Digital.