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Intel Under the Microscope – Faces Antitrust Suit in North America  

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Posted by FiXT— November 5th, 2009, 12:12 PM

scale amd intel 300x213 Intel Under the Microscope   Faces Antitrust Suit in North AmericaThe New York Attorney General has hopped on the bandwagon and launched a lawsuit against Intel over its alleged antitrust actions.


Intel’s business practices have been scrutinized across the globe and so far in nearly every country that it has faced accusations, it has been found guilty. Korea, Japan and most recently Europe have all come to the consensus that Intel engaged in illegal practices regarding its sale tactics and poised unfair competition to rival AMD (Advanced Micro Devices).The recent  European Commission inquiry handed down the stiffest punishment ever seen in the country, with a 1.45 Billion dollar fine.


Intel is accused of misusing its domination position and employing the use of illegal anti -competitive actions to reduce AMD’s presence in the marketplace. This was accomplished by offering enormous monetary rebates to OEM manufacturers in exchange for reducing the usage of AMD products in their units.


This latest lawsuit by NY Attorney General Andrew M. Cuomo, is separate from AMD’s own lawsuit launched in the same state in 2005 which expected to go tor trial later this year. The US Federal Trade Commission also began investigating the blue giant after the South Korean FTC found Intel guilty in 2008.


In a written press statement Cuomo claimed that, “Rather than compete fairly, Intel used bribery and coercion to maintain a stranglehold on the market. Intel’s actions not only unfairly restricted potential competitors, but also hurt average consumers who were robbed of better products and lower prices.”


Many analysts expect this latest latest action by a State legal body may in fact kick start the US FTC into becoming more aggressive in their own investigation and it appears likely that there may be a separate federal inquiry into the situation in the near future.



Written with Content from the Associated Press


Tags: antitrust, ftc, intel, new york

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Comments (22)

  1. CMetaphor's Avatar
    CMetaphor

    November 5, 2009 12:25 PM

    "Intel’s actions not only unfairly restricted potential competitors, but also hurt average consumers who were robbed of better products and lower prices"

    And people wonder why I don't like them...

  2. FiXT's Avatar
    FiXT

    November 5, 2009 12:27 PM

    I couldn't quite find a place to put it in the article, however, apparently according to the New York Times and Dell - Intel reduced Dell's rebates by $600 MILLION when they began to use AMD chips.... that is a HELL of a lot of money!

  3. CMetaphor's Avatar
    CMetaphor

    November 5, 2009 12:34 PM

    ... That just makes me even more Angry. $600 Million...

  4. MarkOne's Avatar
    MarkOne

    November 5, 2009 01:09 PM

    Can you imagine the price of the CPU if Intel are successful to know out AMD.

  5. Jon_di2's Avatar
    Jon_di2

    November 5, 2009 01:14 PM

    Well In Intels defence it does make sense to give rebates to your most loyal customers. So with the dell example; when they started using AMD chips this would have meant that dell would have been buying fewer Intel chips.

    Lets say that dell originally bought 10 Million Intel Chips and when they started to buy AMD chips they only bought 7 Million chips from Intel. Obviously Intel needs to cut costs and taking away rebates from a disloyal customer seems to make sense to me. For every AMD based PC that Dell builds is technically a lost sale for Intel.

    Now they dont give all the details in the article. It might be that Intel told dell and other companies that they would only give rebates/other benefits to them if they did not buy AMD products. If Intel took away the perks for that reason and not because the decline in products bought from their customers... then yes the are

  6. FiXT's Avatar
    FiXT

    November 5, 2009 01:17 PM

    The whole Dell thing was stuff that came out during the EU investigation.

    For further reading hop over to: http://www.nytimes.com/2009/11/05/te...es/05chip.html

    Gives a bit more of the back story, but you will have to dive back to about June to get more details on the exact specifics of the rebates and such


    They brought up your exact question

    "Rebate payments and other incentives provided to customers fall into a murky area of the law, according to antitrust scholars. Intel’s critics must show that it went beyond the typical actions that one would expect from a company trying to protect its business.

    “A lot of what they are talking about here sounds nefarious, but others would look at it and say that is how markets work,” said John E. Lopatka, a professor and antitrust expert at Pennsylvania State University’s Dickinson School of Law.

  7. CMetaphor's Avatar
    CMetaphor

    November 5, 2009 01:19 PM

    Quote:
    Originally Posted by Jon_di2 View Post
    Well In Intels defence it does make sense to give rebates to your most loyal customers. So with the dell example; when they started using AMD chips this would have meant that dell would have been buying fewer Intel chips.

    Lets say that dell originally bought 10 Million Intel Chips and when they started to buy AMD chips they only bought 7 Million chips from Intel. Obviously Intel needs to cut costs and taking away rebates from a disloyal customer seems to make sense to me. For every AMD based PC that Dell builds is technically a lost sale for Intel.

    Now they dont give all the details in the article. It might be that Intel told dell and other companies that they would only give rebates/other benefits to them if they did not buy AMD products. If Intel took away the perks for that reason and not because the decline in products bought from their customers... then yes the are

    The conditions of Dell getting those rebates in the first place was that they Didnt buy AMD products and promoted them less. Read more into this... Intel gave Dell money to sell fewer AMD chips, not to encourage them to buy more Intel ones.

  8. bojangles's Avatar
    bojangles

    November 5, 2009 01:38 PM

    Quote:
    Originally Posted by CMetaphor View Post
    The conditions of Dell getting those rebates in the first place was that they Didnt buy AMD products and promoted them less. Read more into this... Intel gave Dell money to sell fewer AMD chips, not to encourage them to buy more Intel ones.
    This +1.

  9. Sushi Warrior's Avatar
    Sushi Warrior

    November 5, 2009 03:23 PM

    For one thing, NY starting a lawsuit or w/e is biased, they just gave a couple hundred million to GlobalFoundries to make a plant there. Second, I wouldn't agree with the above - Intel payed Dell (and other PC makers) money to sell Intel only, so they still sell the same number of computers anyhow. Less AMD = more Intel, simple math.

  10. geokilla's Avatar
    geokilla

    November 5, 2009 03:41 PM

    Anyone got a link on the antitrust and monopoly kinda actions that Intel were doing? I know it's like well known throughout the computer and tech industry, but I just wanna read about it.

    Glad to see that North America is finally doing something about Intel. Wonder how long the lawsuit will last..

  11. FiXT's Avatar
    FiXT

    November 9, 2009 11:21 AM

    Just to dig this up some more:

    According to THG and Wallstreet... that Dell number... over 5 years turned into 6 BILLION dollars...

    http://www.tomshardware.com/news/Int...Dell,9007.html

  12. CMetaphor's Avatar
    CMetaphor

    November 9, 2009 11:26 AM

    Quote:
    Originally Posted by FiXT View Post
    Just to dig this up some more:

    According to THG and Wallstreet... that Dell number... over 5 years turned into 6 BILLION dollars...

    http://www.tomshardware.com/news/Int...Dell,9007.html

    That tears it... I'll never give Intel or even Dell any of my money. Ever.

  13. FiXT's Avatar
    FiXT

    November 9, 2009 11:53 AM

    I understand the whole rebate idea and such, but as they say in the article. In some years, these "rebates" surpassed Dell's company profits ! :O

  14. martin_metal_88's Avatar
    martin_metal_88

    November 9, 2009 12:00 PM

    Ahahah Cmetaphor have to be happy these day XD. It could be really nice to see the potential ( with full money reserve ) of AMD making new chip. With that lawsuit cutting the grass under intel feet Advanced Micro Device should be abble to gain the 1 years delay they have by intel and make new chip that can compete ANY intel chip. Probably at lower price range. Even if I am using intel chip right now I ever been an AMD fanboy .

  15. norfolk's Avatar
    norfolk

    December 22, 2009 03:00 PM

    I have always been an AMD Fanboy and only recommend that processor based system to all my client"s.

  16. Overclocker~4.1's Avatar
    Overclocker~4.1

    December 22, 2009 03:34 PM

    I only go for performance. if Satan was making awesome chips, I would buy them from him. so whatever Intel is doing, I don't care. as long as they produce superior quality procs. I'm happy.

  17. sswilson's Avatar
    sswilson

    December 22, 2009 05:09 PM

    Quote:
    Originally Posted by Overclocker~4.1 View Post
    I only go for performance. if Satan was making awesome chips, I would buy them from him. so whatever Intel is doing, I don't care. as long as they produce superior quality procs. I'm happy.
    If there's a huge price/performance difference I'll go with the better deal. I'll only stand on principal if there isn't a big difference.

    That said, I still applaud efforts by regulators to keep the playing field level even if it means I have to pay a little more for my kit.

  18. chriskwarren's Avatar
    chriskwarren

    December 22, 2009 05:17 PM

    Thats the thing; if Intel was playing fair, one could argue that AMD would have more resources to produce better chips. But like most, I look at the numbers and do what makes sense for me on that purchase.

  19. CMetaphor's Avatar
    CMetaphor

    December 22, 2009 07:40 PM

    Quote:
    Originally Posted by chriskwarren View Post
    Thats the thing; if Intel was playing fair, one could argue that AMD would have more resources to produce better chips.
    Amen. Someone of intelligence.

  20. Lamb's Avatar
    Lamb

    December 22, 2009 07:48 PM

    But...why would they be fair? If I was in business I would try to crush my 'opponents' every possible way

  21. clone63's Avatar
    clone63

    December 22, 2009 08:14 PM

    Quote:
    Originally Posted by Overclocker~4.1 View Post
    I only go for performance. if Satan was making awesome chips, I would buy them from him. so whatever Intel is doing, I don't care. as long as they produce superior quality procs. I'm happy.
    Where's the line though? Sure we're talking about money here, what about human/animal rights, responsibility and such. Just because something you want is "great and cheap" but the money goes to devaluing your economy, eliminated jobs or controlling lives, even destroying them in unsafe conditions means that it doesn't matter?

    This is not the case in question, I'm just saying, when is it no longer acceptable to buy from a manufacturer.

  22. sswilson's Avatar
    sswilson

    December 22, 2009 08:34 PM

    Depends on the circumstances of course.

    I stopped buying any Maple Leaf products when they shut down that plant out in Sask because they didn't like the fact it was unionized, same with Pot of Gold chocolates... they lost my business completely when they shut down the HFX plant to move production to Mexico.

    My "principle" purchasing decisions are all labour related.

(22) comments | Add your comments

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