July 27th, 2007
EU charges Intel with anticompetitive behavior
In an “enormously important” government action, the European Union has concluded a six-year investigation and concluded that Intel has abused its dominant position in an attempt to squeeze AMD out of the chip market, TopTechNews reports.
The commission claims that Intel provided massive rebates to computer makers if they bought the vast majority of their chips from Intel, paid off manufacturers to delay or cancel AMD-based products, and sold chipsets below cost to beat AMD on price.
Intel general counsel Bruce Sewell said the chip market is “functioning normally” and Intel’s behavior has been competitive and “beneficial to consumers.” If AMD is having trouble in the market, Sewell said, that’s what happens when competitors “falter and underperform.”
Giuliano Meroni, AMD president for Europe, Middle East, and Africa, said, “This is a moment of truth for the entire I.T. industry. We are confident that this statement of objection will be a catalyst in opening the global microprocessor markets for the benefit of consumers and PC companies alike.”
Albert A. Foer, president of American Antitrust Institute, based in Washington, DC, said the delivery of a “statement of objection” to Intel’s practices was “enormously important to the world and to American consumers.”
“If AMD’s allegations are sustained, than Intel has been engaged in a global strategy to monopolize the microchip industry,” he said. If AMD is left “severely crippled,” Foer said, “the world is left with single player for a very important commodity. Innovation depends on a competitor and the allegations are that the dominant player has abused its power to keep AMD from gaining market share.”
While Intel has 10 weeks to respond and eventually appeal to an EU court, Foer said the allegations represent an investigation much more advanced that a preliminary complaint.
The statement of objection is the culmination of a six-year review by “very competent staff” who have been under pressure by the courts to document carefully, Foer said. “One suspects they’ve done their homework. The directorate has to make a strong case,” he said.
