Gigabyte Working Closer with ASUS?

DigiTimes reports that Gigabyte will be transferring its motherboard and graphics card division over to the new joint venture with ASUS called Gigabyte United Incorporated. From January 2007 on, the joint venture will avoid competition between the two Tier-I vendors and allow the joint venture to utilize the resources of each company. Despite the fact that the retail motherboard and graphics card business will be heading towards the joint venture, Gigabyte will remain a key ODM partner for outsourced graphics card and motherboard production.

Gigabyte United will have permanent and exclusive licensed use of the Gigabyte brand and trademark for making and marketing desktop motherboards and graphics cards. Gigabyte Technology will charge for the licensed use of its brand name for five years from the first year Gigabyte United begins to make a profit. Gigabyte United will pay 50% of its operating profit to Gigabyte for three years with the percentage to decrease to 33% for the following two years, according to Gigabyte Technology.


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