Tuesday, May 19th 2009
NVIDIA Accuses Intel of Anti-Competitive Pricing for Atom Processor
Intel was recently awarded a fine of over a billion Euros by the EU for anti-competitive malpractices in the EU. Speaking at Reuters Technology Summit, NVIDIA CEO Jen-Hsun Huang accused Intel of anti-competitive pricing for the Intel Atom processor, although made it clear that NVIDIA won't be pressing charges any time soon.
According to NVIDIA, Intel sells an Atom processor typically for US $45 a piece, while in a bundle with Intel's own chipset consisting of an i945-class northbridge and ICH7-class southbridge for just $25, that's $25 for the processor and Intel chipset. This is driving away motherboard manufacturers from opting for Intel Atom paired with NVIDIA's single-package Ion chipset, which NVIDIA claims, (and reviews have shown,) to offer superior performance and features at almost half the board footprint. "That seems pretty unfair," Huang said. "We ought to be able to compete and serve that market."
Intel was quick to dismiss Huang's accusation. "We compete fairly. We do not force bundles on any computer makers and customers can purchase Atom individually or as part of the bundle," said Bill Calder, a spokesperson for Intel. "If you want to purchase the chip set, obviously there is better pricing." NVIDIA made it clear it doesn't have any immediate plans to lock onto Intel in (yet) another anti-competition case. "I hope it doesn't come down to that," Huang said. "We have to do whatever we have to do when the time comes. We really hope this company [Intel] will compete on a fair basis," he added.
Source:
Reuters
According to NVIDIA, Intel sells an Atom processor typically for US $45 a piece, while in a bundle with Intel's own chipset consisting of an i945-class northbridge and ICH7-class southbridge for just $25, that's $25 for the processor and Intel chipset. This is driving away motherboard manufacturers from opting for Intel Atom paired with NVIDIA's single-package Ion chipset, which NVIDIA claims, (and reviews have shown,) to offer superior performance and features at almost half the board footprint. "That seems pretty unfair," Huang said. "We ought to be able to compete and serve that market."
Intel was quick to dismiss Huang's accusation. "We compete fairly. We do not force bundles on any computer makers and customers can purchase Atom individually or as part of the bundle," said Bill Calder, a spokesperson for Intel. "If you want to purchase the chip set, obviously there is better pricing." NVIDIA made it clear it doesn't have any immediate plans to lock onto Intel in (yet) another anti-competition case. "I hope it doesn't come down to that," Huang said. "We have to do whatever we have to do when the time comes. We really hope this company [Intel] will compete on a fair basis," he added.
92 Comments on NVIDIA Accuses Intel of Anti-Competitive Pricing for Atom Processor
Intel made Atom (yes)
Intel made 945 (yes)
Intel can sell Atom for whatever price they want (yes)
Intel can sell 945 for whatever price they want (yes)
Intel can put 945 + Atom and sell it lower than (Atom + 945) costs (No)
Intel can put 945 + Atom and sell it lower than (Atom) costs (No)
Intel can put 945 + Atom and sell it for a little more than (Atom - $45.05 for example) costs (Yes, I guess), as it's just giving it chipset for free. But offering a rebate just to people buy their chipset rather than ION (or any other developed), is something really wrong and must be against any market law, because once again (as with AMD), a free market is (must be at least, even in face of intels economic force), ruled by costumers, therefore competition.
Something similar to this is: Your energy company just can't sell you energy for whatever price it want, just because it's the only provider of the service.
As for the guys that think: Why don't nvidia just buy the bundle pack to take ATOM out ? Well, easy answer... Production cost, and many other problems that will come with it.... maybe it would be even higher than buying ATOM for $45.00 . And also because it isn't just right for Intel to do that.
If intel wanted to throw atom processors from the sky, attached to little miniature parachutes and notes that say "Free Atom processor!" guess what, THEY CAN. I mean, maybe not to that extend as that would be littering, but you get my point. They put the money into the product, they can price it however they want.
It's wrong, but people, we don't live in a world filled with soft kittens, rainbows, and hugs. Just because you think something is wrong doesn't mean it's illegal. Case in point: Abortion.
Though, I have to agree that it Intel shouldn't be charging more for the processor alone than it does for the processor and chipset.
What would be retarded is if they require you to actually use the 945 chipset with the Atom if you buy the bundle.
You took this quote:and trashed everything else I said.
If intel wants to "burns" atom supply, they can, as long as it won't affect any other company (which obviously it's not the case, here), nvidia spent "some" money into making ION, as a bunch of "guys" did designing atom based solutions.
And why it can't affect other companies ? By doing that Intel would probably make some competition to "close doors", after that it would bring everything back again, higher price for the lack of competition.
Then just imagine ION was a big thing for Nvidia......... nvidia goes out of business, so long for Geforce and Hello expensive Larrabee.
It's like a GAS station selling much cheaper gasoline (at cost price or lower), side by side with another gas station.... as the guy of the cheaper gas station had more money he could support more time taking loss than the other guy (which eventually goes out of business), the one that survived will now rise prices even more because it's the only gas station of the neighborhood.
It happened on my block. It had 3 gas stations, one new (from a big supermarket), came with lower prices, closed all 3 other gas stations then raised prices.
Easy thing to do, isn't it ? So easy and so common that a bunch of laws exists to make sure a fair competition is held on the market. Intel just got fined by EU, don't you remember ?
Before you talk about rainbows or whatever, take a look at the far sight of this type of thing.
And yet if you couldn't understand, sorry, I just don't have the necessary brain to talk about this matter more simple than that.
PS: I'm no Trade Commission, neither lawyer, judge or international trade specialist, I just can't know If I'm 100% right, but at least I try to defend my point of view with solid (maybe hypothetically sometimes) arguments.
That's what makes something "illegal." If you're going to talk about whether it's "moral" or "ethical," that's a completely different argument, but the "legality" of what Intel's doing is hardly in question.
On second thought, yes you can blame the government for that. :laugh:
Your gas station story was heart breaking, it really was. Let me tell you about another gloomy rainy day story with a bad ending. There once was this company, lets call them Bal-Mart! And this company, they saw a way to be highly competitive. They would use extensive foreign product sourcing and low employee benefits to drive the pricing on products in their store so low that poor ol mom and pop stores simply couldn't afford to compete. Mom and pop stores all over started closing as more and more people flocked to the big bad Bal-Mart. In the end, nothing was done about Bal-Mart, because what they were doing was completely legal. People wanted to buy jeans for 6 bucks, and 5 gallon buckets of mayonnaise for a few dollars more. They wanted to save money, go figure. In he end, Bal-Mart and consumers with a Bal-Mart in their town lived happily ever after while local competing stores were forced to compete or close.
Some stores in my town are still open because they have learned to compete. I don't like that wal mart has transformed small town this way, but I understand what they did and see why it was ok from a business perspective.
Intel is playing the business game, and in any game, there's winners and losers.
Nobody is saying that what they are doing is right. I think they should offer the two things with vise versa pricing. What I'm saying is, what I think doesn't matter. What you think doesn't matter. That's the world we live in. Sorry.
Now, given a choice, I will gladly pay an extra 20 bucks than I had to for the ion + atom setup. AND, if you noticed my post above, this sort of thing might not last forever because who is Intel going to turn to when AMD has a competitive product of their own (being that they own ati now.) atom + ion is inevitable to compete with whatever amd has up their sleeve (God I hope they have something cool.)I don't know though. If it were illegal nvidia would take them to court. If you had proof that someone hit your car, why wouldn't you do anything about it? You think nvidia is ran by a bunch of pushovers?
Please can someone do some research and tell us if this is illegal!? LOL
anti competitive laws were not broken here. pricing is set by the company that sells the product and bundles have always been a part of business.
obviously you've never run your own business, worked in marketing, sales, construction, in fact perhaps you've never worked at all.
at any rate. any time a company puts in a bid for job they do this. it's their product/labor and they are allowed to set the price.
Company A buys wire from company B, both bid on the same job.
Company A gives a bid of 1200$ wire + labor
plus 1800$ for fixtures (so 3000$) total.
Company B gives a bid of 1200$ wire + labor if you buy that alone. however if you also buy the fixtures from Company B the total bid is 1800$
Company A has 2 choices, refine their business to stay competitive with company B (may not be possible) or find a new supplier (happens most often)
I've also seen this with roofing manufacturers who also have spin off installers, housing companies, pool installers, computer retailers, and on and on and on.
its real life. I know you all think that capitalism is the bane of the world but it's how America operates. and while we have entered many socialist programs into our system, it doesn't change the base economy or how it operates.
Anyway, I don't believe "it's the world were are living". It sure happens but it's bad commercial practice. Nothing wrong about x-Mart being a more efficient company than small old ones (big and better, I don't see any problem in that, I'm not a socialist thinking guy), the problem is not this here.
Intel know what it's doing, they're not naive, they are doing that to hold most share of the ATOM market, by reducing other non intel platform cost benefit. Intel doesn't plan to soon lunch a good chipset like ION to ATOM, just check the next one to come from it G40 ( is this right ??), same old shit 945.
I just tried to defend my opinion:
The problem is intel selling something to Nvidia for $45 where it clearly could sell for under $25.00 (as it does with 945 combo), and still profit. Doing that is not being efficient at business, but doing bad commercial practices which sometimes are punished if some jury decide it's so.
and don't talk about via nano because ION is months ahead of it and was not made for it.
I also don't expect for it to change when AMD join this market, they also want to hold their own platform, so they won't "be nice" with nvidia as well... :laugh:
At least we will have something much better than 945 and probably ION. I also would like to see VIA on this......
Although as far as I understand it's not right (legal), I don't see Nvidia getting cheap prices to joining this club without a cpu of it own.
It's a fight that it won't take to courts for sure.
This is just under cutting the market, this is good business sense. They are not forcing people to purchase thier and only their products, just offering a "two4one" deal. I hope intel wins this one.