EU to further charge Intel in antitrust case
updated 09:30 am EDT, Wed July 16, 2008
EU Plans New Intel Charges
The European Commission is planning to file yet more antitrust charges against Intel for its alleged monopolistic behavior, the Wall Street Journal now says (registration required). The extra accusations would specifically focus on claims that Intel provided financial incentives to larger European resellers if they would drop any sales of AMD-based systems, all but pushing the smaller chipmaker out of the markets for most home computers and low-cost servers.
Intel has previously argued to the Commission that its approach to selling processors in Europe is legal, including a reportedly deliberate underpricing of chips to force matching but unsustainable price cuts on AMD. European officials, however, have contended that any dominant company has a legal responsibility to drop these same tactics once they control a clear majority of the market in a given region.
European officials involved in the case have yet to publicly confirm or deny the newspaper's assertions, though it's widely understood that any ruling against Intel is likely to include both punitive fines for past actions as well as requirements that Intel allow PC resllers to carry AMD computers and to do so on fair terms.
Fresh-Faced Recruit
Joined: Jan 2006
Just one thing
For years AMD trailed Intel in the CPU market, selling cheaper chips to fight bigger competition. That epoch ended when AMD64 was released. The new architecture pushed AMD into very unfamiliar area: the performance leader throne. Then the obvious happened: AMD increased prices for its CPUs. Intel had to do the opposite, and low production cost allowed Intel to drop prices to competitive level. Also, on top of decreasing sale price, Intel offered further financial benefits to retailers and OEM, often on exclusive basis. AMD had to follow suit and drop prices for their CPUs as well. This chase continued until Conroe came out and the companies switched roles again. But after AMD filed their lawsuit against bigger company, Intel dumped their previous strategy of selling CPUs.
Maybe in some countries what Intel did is illegal. But for one thing I'm very happy: the strategy brought prices down. For both companies. Consumers benefited from it. There were claims about how hard it was to find AMD system back in those days, and those claims put the blame solely on Intel, but since I personally never had issues of getting an AMD system whenever it was required, I can't confirm that, at least on personal level. Also, knowing AMD record for underproducing / underdelivering CPUs on peaks of demand I cannot agree that all the alleged shortages of AMD systems were due to Intel scheming.
Whatever EU Commission will be (and based on MS case it could be anything, even to the point of absurd) I thank Intel for being such a bad and evil monopoly :) Thanks guys, you saved me a few bucks.