SANTA CLARA, USA: With a litigation currently on between Intel and graphics chip vendor Nvidia Corp pending, Nvidia has put on hold the development of chips for Intel's next generation chipsets that were to come with direct media interface architecture.

Such a situation arose after Intel moved court against Nvidia. In its suit filed against Nvidia, Intel has alleged that a four-year-old chipset license agreement between the two companies did not cover Intel's next-generation processors with integrated memory controllers, such as its Nehalem processor.

An irked Nvidia feels that Intel's claims that the graphics chip vendor was not licensed to the new direct media interface architecture have made things difficult.

As a result of this, it would not be able to market chipsets for future Intel CPUs, it said, putting all development on the backburner. Nvidia currently develops chipsets for Intel processors that employ a front side bus (FSB) architecture.

Nvidia has added that it would postpone further chipset investments for Intel DMI CPUs until the matter is resolved in court by next year. It expects the litigation, which is now before the Delaware's Court of Chancery, to conclude next year. Nvidia has also counter-sued Intel, alleging breach of contract.

Meanwhile, Intel has stated that the two companies continue to disagree about what their 2004 license agreement says and that Nvidia's decision to halt development on the chipsets is based on its business needs.