Monday, May 11th 2009
EU Completes Intel Antitrust Case Investigations, Likely to Find it Guilty: Sources
The European Union trade regulatory body is expected to announce its verdict on the high-profile antitrust case against Intel on Wednesday. The company has been booked under charges relating to market malpractice, by influencing computer hardware manufacturers to postpone and/or cancel launches of their products that use CPUs made by its rival AMD. Intel allegedly abused its market position in the CPU industry, to cripple the growth of AMD in Europe, by offering special rebates to computer hardware manufacturers to restrict or eliminate the use of AMD processors. The company allegedly even influenced retailers by offering inducements to sell computers only with Intel processors installed.
The first violation by Intel is that it allegedly set set percentages of its own chips that it wanted PC makers to use, according to sources. Examples include NEC, which was told that only 20 percent of its products could use AMD processors. All Lenovo-made notebooks use Intel processors, while 95% of HP's product-line features Intel processors, sources said.
The second violation was where Intel bribed PC makers to delay or scrap the launch of their products that feature AMD processors, to favor Intel best. The Commission will characterize the payments as "naked restrictions" to competition, the sources said.
When found guilty, the commission will take two forms of action against Intel. A date will be set, following which, Intel cannot offer the rebates and other inducements EU finds illegal. A fine will also be collected from Intel. The commission can charge as much as 10% of Intel's annual revenue as fine, which was $38 Billion in 2008. The trade commission's decision set for Wednesday is said to be extremely complex and lengthy, in order to safeguard the antitrust enforcer against any possible legal challenges from Intel, which is likely to face one of the highest fines in Europe's antitrust history, according to Brussels-based lawyers. Intel's trouble in Europe began in 2000, when AMD complained that Intel was blocking its access to the European market.
Sources:
Reuters, The Wall Street Journal
The first violation by Intel is that it allegedly set set percentages of its own chips that it wanted PC makers to use, according to sources. Examples include NEC, which was told that only 20 percent of its products could use AMD processors. All Lenovo-made notebooks use Intel processors, while 95% of HP's product-line features Intel processors, sources said.
The second violation was where Intel bribed PC makers to delay or scrap the launch of their products that feature AMD processors, to favor Intel best. The Commission will characterize the payments as "naked restrictions" to competition, the sources said.
When found guilty, the commission will take two forms of action against Intel. A date will be set, following which, Intel cannot offer the rebates and other inducements EU finds illegal. A fine will also be collected from Intel. The commission can charge as much as 10% of Intel's annual revenue as fine, which was $38 Billion in 2008. The trade commission's decision set for Wednesday is said to be extremely complex and lengthy, in order to safeguard the antitrust enforcer against any possible legal challenges from Intel, which is likely to face one of the highest fines in Europe's antitrust history, according to Brussels-based lawyers. Intel's trouble in Europe began in 2000, when AMD complained that Intel was blocking its access to the European market.
82 Comments on EU Completes Intel Antitrust Case Investigations, Likely to Find it Guilty: Sources
No, i mean it's not all clear cut or black and white. In my opinion they went too far and should be punished for straying too far to the darker side of grey (i really wanted to write "Dark Side" but that would be too starwarsy). Everyone's opinion of what is right and wrong is different tho, i guess
It's kind of like Van Wyk (a trucking company) and other businesses that make large purchases: buying two products, in the end, is more of a PITA than it is worth. So Van Wyk buys 100 Volvos, a call center buys 100 identically spec'd PCs, a hospital buys a dozen of the same model network printers, etc.
The only way I would buy those 20,000 processors is if there is something distinct about them. For instance, if I have a lot of customers that want sub $1000 PCs and those 100,000 processors are for more than $1000 PCs, I might grab both to satisfy two different customers. However, if that entire order of 100,000 is for a single customer, I wouldn't even think about anyone that can't fulfill the order.Intel doesn't have to say a thing. The market conditions prefer them. This "say" stuff is fabricated and/or stretched so the EU can get their money.
Even if they did say anything, it wouldn't pull customers in, it would push them away to AMD, Via, or IBM. That's what makes that whole fabricated story EU is pushing funny.
Again, you can't "force" customers to do anything. You can "encourage" them to conduct business elsewhere pretty easy though.
I would buy the 20,000 processors from AMD and tell anyone who was expecting those extra 80,000 processors that Intel backstabed us so we aren't able to fulfill the order as soon as expected. If that was a corporate customer, I would keep them informed on how much longer it will take for AMD to get the rest of the processors in.AMD wouldn't see a dime of Intel's money if the EU wasn't greedy stickin their finger in jars it doesn't belong.
On the other hand, if EU bought up all AMD assets effectively making a monopoly then EU and USA would have a right to intervene and break the corporation up. It is necessary so that Intel, alone, does not control the global price for x86 processors.
so screw you and your free market, ill take a regulated one which ensures the security of the ineternational community and economnies.
You're describing a hypothetical business owner with integrity -- that doesn't exist in the real world.
In the real world, you'd tell AMD "no" and buy all your chips from Intel, because if you try to make a stand, someone else picks up your business.
Thus, AMD is screwed out of money by Intel using their market position.
By the way -- you do know that Intel has already been found guilty of doing this in Japan, right?
What difference does it make anyway? Intel lost as expected. The only way that will change is if anti-trust laws are changed (written to be extremely specific in terms of what can be considered "anti-trust"). They won't because too many people profit from it. Effectively, it's bad to be the best at what you do. In baseball, you get slapped with asterisks in the Hall of Fame. In software, you get sued for including software that is required to obtain competitive software. In hardware, you get sued for making a product which is too good for the competitors to keep up with. In politics, you get sued for winning by a landslide. And people say conspiracy theories aren't popular--ha, you're looking at one.
I have nothing further to add. This is a circus with its full compliment of freaks and side shows. There's nothing I can do about it except claim some asteroid as my own and make sure no one finds me. :laugh:
This isn't an insult -- it's just business. Businesses care about the bottom line, and that's it.
And you're never going to see evidence -- deals like this are made between executives on golf courses or over $10k lunches. There's never documentation. The best you can get is the sworn testimony of the vendors who Intel made these demands of, which I *hope* they had for these cases.IANAL, but I'm pretty sure guilt is only absolutely necessary in criminal court -- civil court is different in most countries, as guilt isn't even necessary, just a "preponderance of evidence" or whatever the term is.
Sucks, but as they say, "them's the breaks."No, in baseball you get slapped with asterisks for cheating.
In software, you get sued for including software that you were too arrogant to bother licensing correctly.
(An asteroid? Or a mountain valley somewhere in the American Rockies, yes? :laugh: I'll buy you a ticket. You and any other fellow objectivists that need a ride.)Yes, I'm assuming that -- I state that I'm assuming that for the point of argument. And I'm only basing this on what previous court cases (like the ones I linked from Japan) have said before me -- it's not my own personal opinion.
Others argue that Intel just offered rebates etc. and that it's legal and the EU should stop whining about the way the "free market" works. I guess these guys were there when Intel was just offering rebates and can testify that in court. Rebates are legal, but that's not what Intel is being accused of.
Oh and then there are the enlightened ones, who have seen the true (i.e. greedy and bureaucratic) face of the EU, which is just trying to milk some cash out of Intel from the land of the free and the brave.
EU Fines Intel a Record €1.06 Billion in Antitrust Case