Nvidia Corp., which supported Via Technologies in the launch of the Via Nano microprocessors just more than a month ago, may abandon its further support of Via if it gets license to develop and sell chipsets for Intel Atom chips from Intel Corp. However, such collaboration is hardly truly interesting for both parties.

Market rumours claim that Nvidia used the pact with Via to convince Intel in the necessity to license the company the rights to create and sell chipsets compatible with Intel Atom microprocessors. According to rumours, the Santa Clara, California-based Nvidia will terminate its agreement with Via Technologies once it gets the license for Intel Atom processor system bus, reports DigiTimes web-site.

Even though Nvidia may be interested in addressing the market of Intel Atom-based systems in the mid term, it will hardly be possible for the company to address the market of entry-level chipsets going forward. Unfortunately for Nvidia, right now it does not have a chipset that was designed for Intel Atom and even if it mages to redesign the core-logic for Via Nano that is in development, it will hardly have a long lifespan.

As soon as Advanced Micro Devices and Intel Corp. integrate graphics cores into their central processing units in 2009, the market of affordable core-logic sets will shrink dramatically, which will influence all third-party chipset makers, including Nvidia, Via and Silicon Integrated Systems Corp. Intel Atom processors are also projected to get built-in graphics core next year, which should nearly eliminate any need in chipsets from third-parties for them.

Neither Intel nor Nvidia are interested in short-term collaboration on a specific product amid the ongoing dispute between the two companies. However, if the negotiation is a part of a bigger deal, the companies may truly work together on certain projects going forward after the short-term chipset deal.

Intel, Nvidia and Via did not comment on the news-story.