Intel and the x86 Architecture: A Legal Perspective

Posted by Zarathustra 11:24 AM (CST)

Monday February 27, 2017

With the review embargo of AMD's new Ryzen CPU supposedly lifting in the next few days, rumors, leaks and official marketing is suggesting it is going to be a huge leap forward for AMD, potentially even outperforming Intel's offerings. Many of us PC enthusiasts and consumers have been overjoyed with this news, either because we have warm fuzzy memories of overclocking AMD CPU's during the K7 vs. Netburst era, or because we welcome seeing the return of real competition to the x86 CPU market, which has seemingly stagnated for lack of it over the last decade.

It has also given many of us reason for pause, as we remember all too well what happened the last time AMD had a superior product. Intel resorted to any number of underhanded exclusionary closed doors business tactics, offering OEM's and other major customers large discounts in exchange for locking out the competition. Let's also not forget how they intentionally sabotaged AMD's performance on binaries compiled using their high performance in house compiler. Of course, Intel wound up paying dearly for these improprieties with record billion+ dollar fines from both the FTC and the European Commission, as well as a similarly large settlement with AMD, but by then the damage was already done, condemning AMD to more than a decade of mediocrity.

With this in mind, it is not a surprise that many are very concerned that this, or a variation of it, might happen again. In this environment of hyper-vigilance, several reports of alleged new Intel improprieties have surfaced. We are not in a position to judge the accuracy of these reports or determine the legality of the alleged behaviors, but it does warrant a walk down memory lane, looking at how Intel has navigated the legal landscape throughout its history.

In 2011 the late Greg Tang wrote a comprehensive article in the Harvard Journal of Law and Technology (JOLT) detailing the history of Intel and its aggressive and often questionable legal tactics to stifle competition, dating back to the early years of the x86 architecture in the early 1980's. I think most of us are aware of the legal history of Intel in the last 20 years or so, but it was certainly an eye-opener to me, that similar behaviors date back to the very beginning of the x86 era of computing. I highly recommend the article, as it certainly is an interesting read. The original has unfortunately since dropped off the Harvard Jolt page, but it is still available in the Internet Archive. (an archival version is still live on Jolts page, but the formatting is horrible, making it difficult to read.)

So, could this happen again? I certainly hope not. As Intel, I certainly wouldn't want to go before a judge again, and defend against accusations of the same improprieties they already promised to not repeat, as part of their fine settlements, but I feel it will take all of us in the community to keep the attention on this topic, so that being fined for behaviors like these doesn't just become a 3+ billion dollar cost of doing business in order to kill the competition.

In the early 1980’s, two of the computer industry’s most influential pioneers were undergoing major transformation. Intel withdrew itself from the computer memory-chip industry and reinvented itself as a microprocessor manufacturer; and IBM made its foray into personal computers after years of denying the mainframe’s inevitable death. IBM’s PC development team broke from the company’s tradition of developing complete solutions in-house by deciding to outsource most of the parts and components for its first model. At a time when the microprocessor market was still crowded with a panoply of competing architectures, IBM selected Intel’s 8086 processor as the "brain" of its computer. However, IBM required that Intel find a second-source supplier because production had to be guaranteed and it was too risky to rely on a single company as the sole source of its chips. See Fred Warshofsky, The Patent Wars: The Battle to Own the World’s Technology 134 (1994). Intel approached Advanced Micro Devices (AMD), a startup chipmaker that was founded by fellow Fairchild Semiconductor alumni. The companies signed a technology exchange agreement in 1982, which the Ninth Circuit described as, "in effect, a reciprocal second sourcing agreement: if one party wanted to market parts the other party had developed, it could offer parts that it had developed in exchange." Intel Corp. v. Advanced Micro Devices, Inc., 12 F.3d 909, 910 (9th Cir. 1993) .