The hits simply carry on coming for Intel. AMD’s Epyc chips are gobbling up market share in information facilities whereas Intel’s desktop chips are frying themselves after years of being caught on a stalled structure. The corporate is shedding 15,000 folks and spinning off its foundry enterprise. And now that Intel is on the ropes, the Wall Road Journal experiences that Qualcomm approached the corporate a few takeover, licking its lips over the potential of swallowing Chipzilla entire.

I’ll eat my hat if it occurs.

Not simply because Qualcomm shopping for Intel doesn’t make sense given the businesses’ inventory costs, money reserves, and aggressive positioning, as analyst Ming-Chi Kuo spells out. Not simply because governments would seemingly shut the prospect down, with processors and foundries turning into a key battleground in worldwide politics. Not simply because Intel’s present valuation is lower than the sum of its elements.

The explanation why I believe these rumors gained’t bear fruit is far easier: The business nearly let AMD die a decade in the past as a result of a change of possession would terminate the intensive x86 cross-licensing pact that exists between Intel and AMD.

If Qualcomm (or anybody else for that matter) purchased Intel, they’d have to renegotiate that deal — and AMD isn’t prone to provide charitable phrases now that it’s now not on dying’s door.

Harmful floor for would-be patrons

Today, AMD is using excessive on the AI wave and shopping for up firms left and proper. However the story was very totally different a decade in the past.

Again then, the corporate was struggling after its dear acquisition of ATI’s Radeon graphics and the completely disastrous Bulldozer CPU launch. AMD was saddled with debt and wound up spinning off its fabrication arm as GlobalFoundries. For years afterward, AMD’s very survival was a query mark, up till AMD’s new Zen structure — dubbed “AMD’s final likelihood” by The Motley Idiot — kicked off the corporate’s comeback story.

But though AMD is Intel’s solely true rival within the x86 chip manufacturing house, no white knights or company raiders swooped in to bail AMD out for pennies on the greenback. Why not? No one has actually mentioned.

However think about this: When AMD spun off GlobalFoundries, Intel threatened to sue AMD for breaching its x86 cross-licensing settlement. They wound up burying the hatchet with one other patent settlement, however the specter of a possible thermonuclear patent conflict with Intel little doubt gave would-be AMD patrons pause.

The Register experiences that cross-licensing agreements stay in place between the 2 firms:

“Whereas a variety of the aforementioned patents expired in 2021, it’s our understanding that settlement remains to be in drive and Qualcomm can be topic to vary of management guidelines. In different phrases, Qualcomm wouldn’t be capable of produce Intel-designed x86-64 chips except AMD gave the inexperienced mild. It’s additionally seemingly one of many the explanation why nobody purchased AMD when it was on the ropes; whoever took over it must cope with Intel.”

No one needs to step on that landmine, even with Intel being a relative cut price proper now. Once you add in all these potential regulatory hurdles and the truth that shopping for Intel would put immense monetary stress on Qualcomm, the entire thing doesn’t make sense.

Finally, Qualcomm shopping for Intel smells like a narrative supposed to maneuver monetary markets greater than an precise risk.