EU Completes Intel Antitrust Case Investigations, Likely to Find it Guilty: Sources

[FordGT90Concept]

Except when the administration changes before the ruling has been enacted, and nothing really happens in the end. (See United States v. Microsoft, 1998-2000)

That's an example of an anti-trust case done right. Microsoft was not buying up competitors so there was really no grounds to fine them (you can't fine someone for being good or trying to nudge customers in your direction). All the ruling did was require Microsoft release an API for IE.

This article describes my stance rather well:
http://www.cato.org/pubs/policy_report/v21n2/cpr399.pdf

Now we come to Silicon Valley and Microsoft. I am not going to argue about the technical aspects of whether Microsoft is guilty or not under the antitrust laws. My own views about the antitrust laws have changed greatly over time. When I started in this business, as a believer in competition, I was a great supporter of antitrust laws; I thought enforcing them was one of the few desirable things that the government could do to promote more competition. But as I watched what actually happened, I saw that, instead of promoting competition, antitrust laws tended to do exactly the opposite, because they tended, like so many government activities, to be taken over by the people they were supposed to regulate and control. And so over time I have gradually come to the conclusion that antitrust laws do far more harm than good and that we would be better off if we didn’t have them at all, if we could get rid of them. But we do have them.

If AMD were being sued by the EU for anti-trust, I'd be every bit as angered by it. If you aren't guilty of directly eliminating competition (see Stardard Oil and US Steel), you don't deserve to have a government breathing on your neck.

 

[TheMailMan78]

Yeah Intel is no John D. Rockefeller.

 

[silkstone]

There are many shades of grey

 

[TheMailMan78]

There are many shades of grey

WTF does that mean? What are you the Riddler?

 

[Easy Rhino]

i know is hard to eat this for intel fans but sadly is true;intel way of business has send amd back with years because they can't sell product=no money;amd presence has achieved the low prices on the present market ... even for intel products

im sorry, but intel has not been the demise of amd. amd has been the demise of amd.

 

[mdm-adph]

That's an example of an anti-trust case done right. Microsoft was not buying up competitors so there was really no grounds to fine them (you can't fine someone for being good or trying to nudge customers in your direction). All the ruling did was require Microsoft release an API for IE.

This article describes my stance rather well:
http://www.cato.org/pubs/policy_report/v21n2/cpr399.pdf

Now we come to Silicon Valley and Microsoft. I am not going to argue about the technical aspects of whether Microsoft is guilty or not under the antitrust laws. My own views about the antitrust laws have changed greatly over time. When I started in this business, as a believer in competition, I was a great supporter of antitrust laws; I thought enforcing them was one of the few desirable things that the government could do to promote more competition. But as I watched what actually happened, I saw that, instead of promoting competition, antitrust laws tended to do exactly the opposite, because they tended, like so many government activities, to be taken over by the people they were supposed to regulate and control. And so over time I have gradually come to the conclusion that antitrust laws do far more harm than good and that we would be better off if we didn’t have them at all, if we could get rid of them. But we do have them.

If AMD were being sued by the EU for anti-trust, I'd be every bit as angered by it. If you aren't guilty of directly eliminating competition (see Stardard Oil and US Steel), you don't deserve to have a government breathing on your neck.

You know, I occasionally like some of the things that the CATO Institute says and does, but that passage isn't one of them.

"We would be better off if we didn’t have them at all, if we could get rid of them. But we do have them" -- what does that even mean? Are they simply waxing poetic about a perfect world?

Be they flawed or not, the fact that there are still people existing who want to see an end to things like antitrust laws scares me, especially since we have more than century's worth of evidence showing just how evil companies can become once they get too large.

im sorry, but intel has not been the demise of amd. amd has been the demise of amd.

Oh, and Intel forcing computer makers not to buy AMD chips at all (even if they're a good bargain) at risk of losing Intel's good graces didn't hurt the situation for AMD any?

You're both wrong -- lax regulation has been the demise of AMD.

 

[Easy Rhino]

Oh, and Intel forcing computer makers not to buy AMD chips at all (even if they're a good bargain) at risk of losing Intel's good graces didn't hurt the situation for AMD any?

intel didnt force anyone to do anything. computer manufacturers can choose to do business with whomever they want. why should intel be fined for making savy business decisions?

 

[HTC]

intel didnt force anyone to do anything. computer manufacturers can choose to do business with whomever they want. why should intel be fined for making savy business decisions?

When such business decisions are illegal.

The European Union trade regulatory body are expected to announce their 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.

Why is it that Intel felt the need to engage in these kind of practices? Have they such low confidence in their products that they had to resort to these sort of "tactics" in order to outsell a smaller competitor? Don't think so ... :shadedshu

 

[Easy Rhino]

When such business decisions are illegal.

they should not be illegal...

 

[suraswami]

$38 Billion for Intel = http://www.techpowerup.org/uploaded.php?file=090511/Toi_tissue.jpg

 

[HTC]

they should not be illegal...

But they are (and IMHO, rightly so).

Intel is fully aware of this and they still chose to brake these laws. As such, they should pay the price.

 

[Easy Rhino]

But they are (and IMHO, rightly so).

Intel is fully aware of this and they still chose to brake these laws. As such, they should pay the price.

The law as it is stated should not exist. it exists to FAVOR amd and their operations inside the EU. the EU has sunk billions into Silicon Saxony where amd has an operation. so once again, the govt there has setup laws that are meant to protect the industries the govt has put money into. you are so mad about intel breaking the law, why not be mad about amd exploiting the european union and losing billions in the process?

 

[FordGT90Concept]

You know, I occasionally like some of the things that the CATO Institute says and does, but that passage isn't one of them.

"We would be better off if we didn’t have them at all, if we could get rid of them. But we do have them" -- what does that even mean? Are they simply waxing poetic about a perfect world?

Be they flawed or not, the fact that there are still people existing who want to see an end to things like antitrust laws scares me, especially since we have more than century's worth of evidence showing just how evil companies can become once they get too large.

Read the paragraph following the one I C&P'd. The anti-trust laws of the early 1900's made sense but these new "anti-trust" laws are just gold digging. If "anti-trust" laws have only become means to gold dig, yes, we would be better off without. It is just one greedy person using their position to what another greedy person earned--a double negative that doesn't make it positive.

Oh, and Intel forcing computer makers not to buy AMD chips at all (even if they're a good bargain) at risk of losing Intel's good graces didn't hurt the situation for AMD any?

You're both wrong -- lax regulation has been the demise of AMD.

Intel didn't "force" anything. They just made their product look like the better buy through rebates, discounts, etc. It is common practice across many industries (grocery stores, clothing stores, retail-everything stores, tech stores, etc.). EU is trying to turn Intel into the bad guy by saying all of these rebates/coupons/discounts specifically targeted AMD. That is only the case because AMD is Intel's only real competition. Again, twisting the bigger picture to gold dig--why I hate these kind of "anti-trust" lawsuits coming out of the EU. Double negative (Intel earned it, EU is taking it).

The demise of AMD is their 15 year reliance on Intel followed by another 15 years of mediocre products (Athlon 64 was the only exception only because the P4 was pushed way too long). Then we have the stupid business decisions like buying ATI when AMD was already heading for hard times. That in turn caused the GPU-on-CPU race AMD couldn't afford to fight in the first place. Stupid move after stupid move after stupid move--the story of AMD. It's shocking they didn't fall under back in the 1980s.

 

[a_ump]

I agree, i'm not an amd or intel fan, i buy what's best for my dollar. But these claims do not surprise me any, the c2d architecture was magnificent, but had Intel not been pullin these business deals, AMD probly would have had better profit, as most home computers when c2d architecture was released and shoot even up to about late 2005, off the shelf computers still used pentium D and athlon x2. I'm happy that intel is getting fined, and someone complained slightly about amd only getting 60% but that's 22.8 billion, which is a shit ton more than what their normal revenue is, which was 5.8billion for 2008. so they're going to receive 3.6 times what their last years revenue was once this ruling is finalized. That's fantastic news imo, as intel is getting too far ahead of AMD, yes Phenom II brought AMD to c2d/c2q levels, but i7 is still ahead, and we have yet to see how the slightly cheaper i5 products do, not to mention westmere arriving this Q4 2009 which will be larrabee. AMD's fusion is still planned for a 2011 launch, 2 years behind intel's GPU+CPU chip. Hopefully this will help greatly with AMD's research and whatnot with their CPU's and Fusion.

Intel didn't "force" anything. They just made their product look like the better buy through rebates, discounts, etc. It is common practice across many industries (grocery stores, clothing stores, retail-everything stores, tech stores, etc.)

The demise of AMD is their 15 year reliance on Intel followed by another 15 years of mediocre products (Athlon 64 was the only exception only because the P4 was pushed way too long). Then we have the stupid business decisions like buying ATI when AMD was already heading for hard times. That in turn caused the GPU-on-CPU race AMD couldn't afford to fight in the first place. Stupid move after stupid move after stupid move--the story of AMD. It's shocking they didn't fall under back in the 1980s.

true about the marketing part in a sense, as you see insurance companies all over the tv advertising, "come with us and your going to save up to $XXX over Geico, Allstate, etc" and vice versa as each insurance company states that claim. But still i how big a discount and whatnot they offered companies? as well as the claimed bribing they did. It's dirty play for sure, worth 38billion? idk and i certainly don't care as i guess you could call me an AMD supporter(not fanboy) right now as i want them to improve their products to drive down intel's prices and improve competition.

But i don't agree that buying ATI was a stupid move. It will help them with fusion for sure, and if anything they've benefitted quite a bit as who know's if ATI's HD 4XXX series would be delivering good performance like it is now if AMD hadn't bought it as i'm sure AMD made some changes to ATI's plans for their future GPU's. Hence we have great results now, and it helped AMD's profits. ATI purchase was a smart move imo, though i disagreed with it at the time.

 

[HTC]

I agree, i'm not an amd or intel fan, i buy what's best for my dollar. But these claims do not surprise me any, the c2d architecture was magnificent, but had Intel not been pullin these business deals, AMD probly would have had better profit, as most home computers when c2d architecture was released and shoot even up to about late 2005, off the shelf computers still used pentium D and athlon x2. I'm happy that intel is getting fined, and someone complained slightly about amd only getting 60% but that's 22.8 billion, which is a shit ton more than what their normal revenue is, which was 5.8billion for 2008. so they're going to receive 3.6 times what their last years revenue was once this ruling is finalized. That's fantastic news imo, as intel is getting too far ahead of AMD, yes Phenom II brought AMD to c2d/c2q levels, but i7 is still ahead, and we have yet to see how the slightly cheaper i5 products do, not to mention westmere arriving this Q4 2009 which will be larrabee. AMD's fusion is still planned for a 2011 launch, 2 years behind intel's GPU+CPU chip. Hopefully this will help greatly with AMD's research and whatnot with their CPU's and Fusion.

Isn't it $2.28 billion? It should be 60% of (10% of $38 billion), or 6% of $38 billion, no?

 

[mdm-adph]

intel didnt force anyone to do anything. computer manufacturers can choose to do business with whomever they want. why should intel be fined for making savy business decisions?

Intel didn't "force" anything. They just made their product look like the better buy through rebates, discounts, etc. It is common practice across many industries (grocery stores, clothing stores, retail-everything stores, tech stores, etc.).

Look -- I'm going to explain this one more time...

Intel doesn't need to "force" anyone with threats of broken kneecaps and bricks through windows -- this isn't TV.

Let's say you're a computer manufacturer. You have 100,000 orders for computers you need to fill. AMD is able to provide 20,000 chips to you -- Intel can provide as many as you need.

Now, you could just buy all your chips from Intel -- sure, why not. But hey -- AMD comes along and says, "We know we don't have the capacity to provide all 100,000 chips you need -- but we'll provide 20,000 very fine and fast chips to you at a comparable price with Intel."

You, as the computer manufacturer, sees this as a good deal -- you can gets the chips you want from both companies, and have them both compete over prices to court you, their customer.

This is where the fair market ends and crooked monopolistic practices begin.

Instead of just being happy with 80% of your business, Intel tells you, "you will buy all of your chips from us."

You say, "no way, I can buy from who I want to."

Intel then tells you, "if you continue to buy chips from AMD, we will stop selling you any chips, or we will raise our prices so much for you that you'll suffer."

And now, Intel has in effect "forced you" to buy only from them. You have 100,000 orders to fill -- AMD can only provide 20,000. You could buy some chips from Intel and some from AMD, but if you Intel refuses to sell you chips at a good price, you won't be able to fill those other 80,000 orders, and your business will suffer or even go out of business!

Do you see what I'm getting at?

Intel is hurting the free market with their practices. If you truly believe in and worship the free market, you should agree that they need to be punished.

 

[a_ump]

Isn't it $2.28 billion? It should be 60% of (10% of $38 billion), or 6% of $38 billion, no?

It was mentioned that AMD was to recieve 60% of the 38 billion.

38/100=.38
.38x60=22.8

22.8 billion

 

[HTC]

It was mentioned that AMD was to recieve 60% of the 38 billion.

38/100=.38
.38x60=22.8

22.8 billion

Nope: you forced me to double check to make sure i wasn't in error.

The commission can charge as much as 10% of Intel's annual revenue as fine, which was $38 Billion in 2008.

Look -- I'm going to explain this one more time...

Intel doesn't need to "force" anyone with threats of broken kneecaps and bricks through windows -- this isn't TV.

Let's say you're a computer manufacturer. You have 100,000 orders for computers you need to fill. AMD is able to provide 20,000 chips to you -- Intel can provide as many as you need.

Now, you could just buy all your chips from Intel -- sure, why not. But hey -- AMD comes along and says, "We know we don't have the capacity to provide all 100,000 chips you need -- but we'll provide 20,000 very fine and fast chips to you at a comparable price with Intel."

You, as the computer manufacturer, sees this as a good deal -- you can gets the chips you want from both companies, and have them both compete over prices to court you, their customer.

This is where the fair market ends and crooked monopolistic practices begin.

Instead of just being happy with 80% of your business, Intel tells you, "you will buy all of your chips from us."

You say, "no way, I can buy from who I want to."

Intel then tells you, "if you continue to buy chips from AMD, we will stop selling you any chips, or we will raise our prices so much for you that you'll suffer."

And now, Intel has in effect "forced you" to buy only from them. You have 100,000 orders to fill -- AMD can only provide 20,000. You could buy some chips from Intel and some from AMD, but if you Intel refuses to sell you chips at a good price, you won't be able to fill those other 80,000 orders, and your business will suffer or even go out of business!

Do you see what I'm getting at?

Intel is hurting the free market with their practices. If you truly believe in and worship the free market, you should agree that they need to be punished.

Very good example, dude

 

[a_ump]

ah, i'd misunderstood haha nice catch there i didn't realize the 10% part. hum 2.28 billion for years of supposed sabotage in the EU's opinion. wow intel is going to laugh at a 3.8 billion fine, hahahaha shit no wonder they did it they won't even feel it. Pitiful fine imo.

 

[Wile E]

Look -- I'm going to explain this one more time...

Intel doesn't need to "force" anyone with threats of broken kneecaps and bricks through windows -- this isn't TV.

Let's say you're a computer manufacturer. You have 100,000 orders for computers you need to fill. AMD is able to provide 20,000 chips to you -- Intel can provide as many as you need.

Now, you could just buy all your chips from Intel -- sure, why not. But hey -- AMD comes along and says, "We know we don't have the capacity to provide all 100,000 chips you need -- but we'll provide 20,000 very fine and fast chips to you at a comparable price with Intel."

You, as the computer manufacturer, sees this as a good deal -- you can gets the chips you want from both companies, and have them both compete over prices to court you, their customer.

This is where the fair market ends and crooked monopolistic practices begin.

Instead of just being happy with 80% of your business, Intel tells you, "you will buy all of your chips from us."

You say, "no way, I can buy from who I want to."

Intel then tells you, "if you continue to buy chips from AMD, we will stop selling you any chips, or we will raise our prices so much for you that you'll suffer."

And now, Intel has in effect "forced you" to buy only from them. You have 100,000 orders to fill -- AMD can only provide 20,000. You could buy some chips from Intel and some from AMD, but if you Intel refuses to sell you chips at a good price, you won't be able to fill those other 80,000 orders, and your business will suffer or even go out of business!

Do you see what I'm getting at?

Intel is hurting the free market with their practices. If you truly believe in and worship the free market, you should agree that they need to be punished.

The thing is, I just don't believe that's how it went down. I'm willing to bet that all Intel did was to way undercut AMD's prices, with no threats to the OEMs about pulling out. Intel can afford to undercut AMD much easier than AMD could undercut Intel. AMD simply couldn't keep up, and would've had to operate at a loss.

I see nothing wrong with that. That's the definition of a free market.

 

[a_ump]

The thing is, I just don't believe that's how it went down. I'm willing to bet that all Intel did was to way undercut AMD's prices, with no threats to the OEMs about pulling out. Intel can afford to undercut AMD much easier than AMD could undercut Intel. AMD simply couldn't keep up, and would've had to operate at a loss.

I see nothing wrong with that. That's the definition of a free market.

ah, but that's all any of us actually can do, is have hunch or thought of what intel really did. It wouldn't surprise me if they had done that, but if it is true, i still believe AMD would have been at a loss as intel's marketing bs or w/e didn't keep AMD from getting the HD 2900XT or phenom series right the first time, that is what killed them was a failure in both divisions of the company. This fine is nothing to get excited about imo, 3.8 billion isn't much, i mean we're talking about intel here. They go from 38billion to 34 billion, not a big deal imo.

 

[Flyordie]

Read the paragraph following the one I C&P'd. The anti-trust laws of the early 1900's made sense but these new "anti-trust" laws are just gold digging. If "anti-trust" laws have only become means to gold dig, yes, we would be better off without. It is just one greedy person using their position to what another greedy person earned--a double negative that doesn't make it positive.




Intel didn't "force" anything. They just made their product look like the better buy through rebates, discounts, etc. It is common practice across many industries (grocery stores, clothing stores, retail-everything stores, tech stores, etc.). EU is trying to turn Intel into the bad guy by saying all of these rebates/coupons/discounts specifically targeted AMD. That is only the case because AMD is Intel's only real competition. Again, twisting the bigger picture to gold dig--why I hate these kind of "anti-trust" lawsuits coming out of the EU. Double negative (Intel earned it, EU is taking it).

The demise of AMD is their 15 year reliance on Intel followed by another 15 years of mediocre products (Athlon 64 was the only exception only because the P4 was pushed way too long). Then we have the stupid business decisions like buying ATI when AMD was already heading for hard times. That in turn caused the GPU-on-CPU race AMD couldn't afford to fight in the first place. Stupid move after stupid move after stupid move--the story of AMD. It's shocking they didn't fall under back in the 1980s.

Actually they are only taking 25-30% of it... AMD gets 60% of the fine...sooo.... where you going with that statement... cause you are preying on the people who didn't read up on EU regulations a little bit...

It was mentioned that AMD was to recieve 60% of the 38 billion.
38/100=.38
.38x60=22.8
22.8 billion

On this- its just 60% of the total fine. Not Intels worldwide revenue...

 

[R_1]

Look -- I'm going to explain this one more time...

Intel doesn't need to "force" anyone with threats of broken kneecaps and bricks through windows -- this isn't TV.

Let's say you're a computer manufacturer. You have 100,000 orders for computers you need to fill. AMD is able to provide 20,000 chips to you -- Intel can provide as many as you need.

Now, you could just buy all your chips from Intel -- sure, why not. But hey -- AMD comes along and says, "We know we don't have the capacity to provide all 100,000 chips you need -- but we'll provide 20,000 very fine and fast chips to you at a comparable price with Intel."
Intel still has nightmares with famous AMD Sledgehammer.

You, as the computer manufacturer, sees this as a good deal -- you can gets the chips you want from both companies, and have them both compete over prices to court you, their customer.

This is where the fair market ends and crooked monopolistic practices begin.

Instead of just being happy with 80% of your business, Intel tells you, "you will buy all of your chips from us."

You say, "no way, I can buy from who I want to."

Intel then tells you, "if you continue to buy chips from AMD, we will stop selling you any chips, or we will raise our prices so much for you that you'll suffer."

And now, Intel has in effect "forced you" to buy only from them. You have 100,000 orders to fill -- AMD can only provide 20,000. You could buy some chips from Intel and some from AMD, but if you Intel refuses to sell you chips at a good price, you won't be able to fill those other 80,000 orders, and your business will suffer or even go out of business!

Do you see what I'm getting at?

Intel is hurting the free market with their practices. If you truly believe in and worship the free market, you should agree that they need to be punished.

Good explanation. I will add to it some differentiation - if it was some Celeron CPU-s , then it's OK with Intel. When it comes to server segment, military supply and government strategic reserve - they wish that AMD was never born. Intel still has nightmares with this famous AMD Sledgehammer.

 

[Shadin]

The thing is, I just don't believe that's how it went down. I'm willing to bet that all Intel did was to way undercut AMD's prices, with no threats to the OEMs about pulling out. Intel can afford to undercut AMD much easier than AMD could undercut Intel. AMD simply couldn't keep up, and would've had to operate at a loss.

I see nothing wrong with that. That's the definition of a free market.

A few years back, several big wigs from OEM's came forward stating that Intel had implied that they'd pull their products if they did business with AMD. I run Intel rigs, but I know they've done some pretty shady things in the past in the name of competition.

However, there's something wrong with what you're saying. The EU is accusing Intel of selling their product at a loss to maintain market share. That sounds all well and fair, but that doesn't protect you, the customer. Intel is large enough to do that and completely drive AMD and everyone else out of business, since they have the capital to run at a loss for probably years on end. When everyone else goes out of business, do you think prices are going to remain low and reasonable?

I'm all for competition, but practices like that where the company is losing money in an effort to drive competitors out of business is bad for all of us.

 

[WhiteLotus]

The European market is too large for Intel to leave. If they did they would see huge reductions in the amount of chips sold, which would then mean them forcing the prices up in the USA so they can maintain profit margins. If you really have that kind of attitude to the EU then you may want to consider just how expensive it'll be to purchase your nice new shiny intel chip if they leave the European market.
Once you considered that i doubt you want them to leave and just pay the fine, behave for a few years and then go back to business as usual.

The shear size of the EU and the shear mountain of logistical work there has to be done is astronomical - no wonder the report will be "x" hundreds of pages long - think of how many countries are in the EU, speaking different languages, and now consider how many retailers there are in each country. No wonder the document is going to be massive.

Toward the legal side of things, although most countries except the EU laws many still do not abide by them. The UK has the LARGEST DNA/capita database in the world and it has been proven that if half (if not more) of those samples are against the human rights act. What needs to be seen here is just where in the EU these charges are being brought, and just WHO decided that they needed to be. This isn't some way of making a quick buck, again i ask you to realise how big the EU is, 10% of $38billion (IIRC) isn't going to do squat for the countries - it'll be most likely used to fund some kind of program to refund the retailers/ other companies that lost out to intel. Who is to say that the only other company is AMD, what about VIA?

Finally, this should have been brought about by AMD/VIA and not the EU, whether it was and the EU are just fronting it i don't know. I have yet to see any evidence and therefore can not make an informed decision.