FEDERAL REGULATORS, INTEL OK SETTLEMENT.

Byline: Eun-Kyung Kim Associated Press 

Microchip giant Intel Corp. reached a tentative agreement with federal regulators to settle claims that it illegally bullied rivals to maintain its dominance in the high-tech industry.

But the announcement Monday, on the eve of an antitrust hearing expected to last three months, came with a reminder from the Federal Trade Commission: A larger antitrust battle still looms.

Both sides refused to comment on details. FTC spokeswoman Victoria Streitfeld said officials ``set out to establish a principle'' and believe ``that in the proposed agreement, they achieved that goal.''

Intel's president and chief executive officer, Craig Barrett, called the agreement a ``win-win'' for both sides. ``We are satisfied that the agreement gives us value for our intellectual property rights,'' he said in a statement.

Federal regulators wouldn't elaborate on the ``remaining issues under investigation'' mentioned in their announcement. But antitrust experts say it refers to a much broader inquiry into Intel's practices.

``This was a piece of a larger investigation where the FTC was looking into whether Intel used its market position to achieve dominance in related areas,'' said Kevin Arquit, a New York antitrust lawyer and former director of the FTC's Bureau of Competition.

Specifically, he said, the agency could be examining whether Intel illegally tied certain technical features to its microchips, forcing companies that buy one Intel product to use the other ``bundled'' with it. A similar issue is part of the Microsoft Corp. antitrust trial.

For now, a settlement means the FTC will get what it wanted - an order prohibiting Intel from withholding information from customers because of patent squabbles. The full commission must approve the settlement before it becomes official, and is expected to vote within two weeks.