Saturday, May 2nd 2009

Intel to be Slapped with Greatest Fine in EU History

It is predicted that silicon giant Intel may face the greatest fine for its alleged anti-competitive practices, in a case heard in the European Union. Intel is currently being investigated for irregularities including encouraging hardware vendors not to use AMD products, and offering discounts. Legal analysts estimate the fine to be well over 1,000,000,000 EUR, over double that of what is heading Microsoft's way. In a statement to the New York Times, says Howard Cartlidge, head of the EU competition group at law firm Olswang in London, "I would be surprised if the fine isn't as high or higher than in the Microsoft case. Technology markets are where the European Commission has perceived particular problems due to dominant companies."

The ongoing trial in EU runs parallel to similar anti-competition trials in Japan and Korea, where Intel is found guilty. It is a joint effort between EU and United States Federal Trade Commission investogators. Despite previous convictions, Intel maintains that it has done nothing wrong and is confident of being found innocent. Says Intel spokesperson Robert Manetta, "Overall, Intel's conduct is lawful, pro-competitive and beneficial to consumers." Naturally, AMD begs to differ. Sources in AMD reveal that Intel conducted anti-competitive practices throughout, to maintain an 80-20 competition. The number took very little change even when AMD was at the peak of technology advancement over Intel.
Source: TechConnect Magazine
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142 Comments on Intel to be Slapped with Greatest Fine in EU History

#76
lemonadesoda
Once again, there is the EU trying to "tax" a company to help cover up the huge financial mess they have got themselves into. How politically convenient. And what a nice way to "cover the hole" of the whopping salaries and expense accounts at the EU parliament.
Posted on Reply
#77
TreadR
newtekie1If you read the article[...] Dell did it.
Shows how less you know about commerce.

If 9 out of 10 companies buy a product at price and get a discount of 20% for not acquiring the competitor's product as well, and that remaining company gets 0% discount, just the batch price because it wants to serve its clients every option that there is... how do you think it would be able survive? The other 9 co. can just add a 19% profit and that would mean a clear loss for that single one company.

In this situation, and in my view... that's far from fair business!
newtekie1The Nehalem chipset licensing issue was that nVidia didn't want to pay Intel to license the QPI tech, they want Intel to give it to them and let them use it for free.
No, you're misinformed! AFAIK it was QPI for NF200less-SLI-enabled Intel boards! This way, the mobo manufacturers could choose if they want SLI for 5$ through a soft mod, no SLI at all or the alternative, a 50$ to 100$ NF200 version (price depending on manufacturer) that would enable SLI. That was the deal... but once Intel got their 5$ mod, NV got nothing!
Easy RhinoAMD dies, which most speculators believe will happen in some way by 2011
Don't be one of those sorry kids that eats this kind of BS... it's really sad when people do that!
I've heard a enough that AMD dies, goes bankrupt, gets bought, goes tits-up or gets blown up because of financial problems in the last 8 or so years... so far, they are pushing products that a lot of us can afford and are glad it's still here to make a difference.

What happens with the money remains to be seen... so far people can speculate all they want about EU... the show's not over!
Posted on Reply
#78
ghost101
alexp999So thats how the EU is bailing the banks out.
If only 1bn EUR was anywhere near enough the the world would be so much better. When we live in an environment where the word trillion is used often, you have to appreciate how 1bn is no where near enough to bail out banks.
Really does the EU have nothing better to do than fine everybody :shadedshu
The European Competition Commission has nothing other than to investigate companies and anticompetitive behaviour. Its why it was created.
Posted on Reply
#79
ghost101
Morgothintel dont pay to eu!
And both the japanese and korean regulators? What about the FTC? Intel still need to sell their products. Without europe, the US and Japan they pretty much alienate most of the world's wealth.
Posted on Reply
#80
Morgoth
Fueled by Sapphire
ghost101And both the japanese and korean regulators? What about the FTC? Intel still need to sell their products. Without europe, the US and Japan they pretty much alienate most of the world's wealth.
use multi quote idiot, actealy i dont care
i can still order from us stores
Posted on Reply
#81
e6600
ghost101If only 1bn EUR was anywhere near enough the the world would be so much better. When we live in an environment where the word trillion is used often, you have to appreciate how 1bn is no where near enough to bail out banks.



The European Competition Commission has nothing other than to investigate companies and anticompetitive behaviour. Its why it was created.
anti competitive?
if anything the EU promotes competition... why do you think they are trying to stop an intel monopoly?

without amd, intel would be sitting on $500 multi core P4's at 6ghz LOL
Posted on Reply
#82
newtekie1
Semi-Retired Folder
TreadRShows how less you know about commerce.

If 9 out of 10 companies buy a product at price and get a discount of 20% for not acquiring the competitor's product as well, and that remaining company gets 0% discount, just the batch price because it wants to serve its clients every option that there is... how do you think it would be able survive? The other 9 co. can just add a 19% profit and that would mean a clear loss for that single one company.

In this situation, and in my view... that's far from fair business!
It is perfectly fair because if Company A is offering a discount, then there is nothing stopping Company B from offering a discount either. Again, I see this in my families business all the time, our suppliers constnatly offer us discounts as long as we buy from them only, we don't so we don't get the discounts, but that doesn't mean the offers disappear.

Your ideas are flawed in that you don't take into account the fact that Intel had competition. It isn't an issue of if they didn't take the discount, then they would have to sell Intel products with lower profits. They just better be buying AMD products at competitive prices to what Intel's products with the discount. It is competition, if AMD wants to compete, they need to offer their products to the companies at competitive prices.
TreadRNo, you're misinformed! AFAIK it was QPI for NF200less-SLI-enabled Intel boards! This way, the mobo manufacturers could choose if they want SLI for 5$ through a soft mod, no SLI at all or the alternative, a 50$ to 100$ NF200 version (price depending on manufacturer) that would enable SLI. That was the deal... but once Intel got their 5$ mod, NV got nothing!
Actually, you are misinformed. The NF200 thing didn't come up till about half way through the ordeal.

At first, nVidia wanted to make true chipsets for the i7. However, to do that they need to use QPI, which they need to license from Intel. NVidia wanted Intel to allow them to use QPI for free, Intel would have no part of that. And Intel is in the right here, they spent a huge amount to develope it, they aren't going to give it away for use for free, especially not to a company just so they can develope a competing product. By the time nVidia finally caved and agreed to pay licensing fees for QPI it was too late for them to get a chipset out before launch, in fact we still haven't seen a chipset from them.

Of course this would have screwed nVidia, because it would mean that they would not have an SLi solution out for the i7 for a large amount of time, and poeple would be using Crossfire exclusively. So nVidia's next big idea was to simply have motherboard manufacturers put NF200 chips on any i7 motherboard that they wanted to support SLi. The backfired because the manufacturers told nVidia they wouldn't have enough time to develope boards like this in time for the i7 launch, and they also told nVidia they would likely not produce many boards with the NF200 chip due to the extra cost.

This is finally when nVidia gave up on having one of their chips on every SLi board, and finally just allowed manufacturers to qualify the board for SLi by simply paying a small licensing fee and sending nVidia samples for SLi qualification.
Posted on Reply
#83
Unregistered
Here is the best explanation I could find of when exclusive dealing agreements are illegal.
Exclusive Dealing Agreements

Exclusive dealing agreements are a form of second-degree price discrimination, similar to requirements tie-in sales. In exclusive dealing agreements, a buyer agrees to purchase all of its requirements for some product or service from one suppliers. For instance, restaurant and
fast food franchises often agree to purchase all of their supplies (cups, plates, food ingredients, etc.) from the parent company.

Courts currently apply the rule of reason to exclusive dealing agreements, which are often recognized to provide economic benefits to both buyers and sellers. Via exclusive dealing agreements, small retailers and businesses can be assured of having a steady supply of products and inputs, while suppliers can be assured of having buyers. Courts have looked at the market power of firms engaged in exclusive dealing agreements in order to judge such agreements' legitimacy; firms without substantial market power have tended to be allowed to engage in exclusive dealing agreements, whereas exclusive dealing agreements on the part of "dominant" firms have tended to be curtailed.

However, the criteria for market power and market dominance are vague. Any particular firm cannot at any time be sure if its exclusive dealing agreements are legal or not until the matter is taken to the courts.
#84
mechtech
even if it is over 1 Billion Euros, Intel could probly cut a cheque for that lol, more important than the fine will be the verdict, GUILTY or innocent.
Posted on Reply
#85
newtekie1
Semi-Retired Folder
Thank you twilyth, the bold statement is exactly the reason I have issue with this ruling against Intel(and the rulings against Microsoft).

You should not be punished, and not have to follow special rules, simply because you are a bigger company. The same rules should apply to all companies, large or small. Otherwise, who is to decided what company is big enough to be considered big? The governing bodies are purposely not establishing guidelines on what companies are big, and which aren't. So they can extract as much free money out of as many companies as possible.

Laws and rules like this need to be an all or none issue. Either enforce the rules for all companies, or none. You don't get to selectively choose which companies you will suddenly start enforcing the rules for. You can suddenly decide you will enforce the rule for a single company just so you can get some money out of them.
Posted on Reply
#86
tkpenalty
newtekie1Thank you twilyth, the bold statement is exactly the reason I have issue with this ruling against Intel(and the rulings against Microsoft).

You should not be punished, and not have to follow special rules, simply because you are a bigger company. The same rules should apply to all companies, large or small. Otherwise, who is to decided what company is big enough to be considered big? The governing bodies are purposely not establishing guidelines on what companies are big, and which aren't. So they can extract as much free money out of as many companies as possible.

Laws and rules like this need to be an all or none issue. Either enforce the rules for all companies, or none. You don't get to selectively choose which companies you will suddenly start enforcing the rules for. You can suddenly decide you will enforce the rule for a single company just so you can get some money out of them.
A company is deemed big when they dominate the market that they're in. In this case these business deals only lose their legality when they become anti-competetive, making it impossible for the competitor in the same sector to sell their goods. Remember, economies these days are mostly mixed markets, and all or none solutions never work (True Capitalism/True Socailism), and same goes for this law.

Is it fair that, none of the OEMs will use Company A's products, because the dominating Company X decided to pay these OEMs not to use them? Thats whats going on. Thats just abusing your market position, its like a person paying people to take up places in a competition with limited places so that you cant participate, because you'd be a threat to their victory.
Posted on Reply
#87
buggalugs
I dont doubt intel have done this because it seems like everyone in the IT industry is doing it. Its not just the EU prosecuting either, there have been many cases in the US, Korea, Taiwan ,Japan and various countries, but mainly countries that produce technology.

AMD and Nvidia were busted for price fixing, The memory makers in Korea were busted , the LCD makers in Taiwan. They all seem to be sheisters and they are all involved to some degree.
Posted on Reply
#88
newtekie1
Semi-Retired Folder
tkpenaltyIs it fair that, none of the OEMs will use Company A's products, because the dominating Company X decided to pay these OEMs not to use them? Thats whats going on. Thats just abusing your market position, its like a person paying people to take up places in a competition with limited places so that you cant participate, because you'd be a threat to their victory.
Yes, it is fair, because there is nothing stopping Company A from offering the same deals as Company X. It isn't Company X's fault that Company A can't/won't be competitive.
Posted on Reply
#89
Mussels
Freshwater Moderator
newtekie1Yes, it is fair, because there is nothing stopping Company A from offering the same deals as Company X. It isn't Company X's fault that Company A can't/won't be competitive.
theres a difference between offering a lower/more competetive price, and only offering that lower price to people who dont sell any competing products.
Posted on Reply
#90
Haytch
I wish i could be in that hearing.

I really dont think any of us know exactly what went on. Surely the evidence we have gathered helps sway our opinions but we should never forget that the masses are indeed sheep.

I have seen too many times, a poor quality, stupid product mass produced and sold, and dominate market share. Probably as many times as i have seen shady business actions.

I think i have heard too many Binderberg conspiracy theories and just felt like adding that the money ending up in the banks hands is what the final outcome will be. U.S is a dry-well, lets drain everything via E.U. That being said, it wont matter if Intel did or didnt when 3/4 of the worlds population is DEAD. . . ( Dont mind me, i just thought i'll spin this off until we get an outcome. )

. . . If i was Intel, i would have made sure AMD was dead by now and have total Monopoly in the industry, killing any uprising competition YEARS ago. This would lead to hostile takeovers of everything remotely related. Anyone that opposes, will have no technology. - - Lucky hey!
Posted on Reply
#91
tkpenalty
HaytchI have seen too many times, a poor quality, stupid product mass produced and sold, and dominate market share. Probably as many times as i have seen shady business actions
mmm Gibson guitars? :D I hope you mean that.
Posted on Reply
#92
Hayder_Master
smack that intel , every one notice this , no fair challenge , now time kick ass
Posted on Reply
#93
kaneda
btarunrEU isn't the only one with the contention that Intel is into market malpractices. Korea and Japan back EU's contention with their own trials. Besides EU is also using USFTC for the investigation. If proven guilty, a US federal agency will have backed EU. One can't corner and bitch at EU.
People like to blame europe for everything. Honestly we dont take offense at it anymore.
Posted on Reply
#94
WhiteLotus
kanedaPeople like to blame europe for everything. Honestly we dont take offense at it anymore.
they sure do :shadedshu kinda like water off a ducks back now
Posted on Reply
#95
Mussels
Freshwater Moderator
kanedaPeople like to blame europe for everything. Honestly we dont take offense at it anymore.
canada, new zealand and scotland are previous countries who have taken the position of "blame them for everything"

I suggest we use the french next.
Posted on Reply
#96
kaneda
Musselscanada, new zealand and scotland are previous countries who have taken the position of "blame them for everything"

I suggest we use the french next.
Scotland's in europe. but yeah, i say we band together and blame America.
Posted on Reply
#97
Mussels
Freshwater Moderator
kanedaScotland's in europe. but yeah, i say we band together and blame America.
america is too easy a target. no challenge.
Posted on Reply
#98
WhiteLotus
ok then the ozzies - damn drunk yobs :p
Posted on Reply
#99
Mussels
Freshwater Moderator
WhiteLotusok then the ozzies - damn drunk yobs :p
Britain: the only empire to have given its prisoners a better country than its own people. thanks guys!
Posted on Reply
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