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Intel Handed Record Fine By EU

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Intel Handed Record £948m Fine By EU

Despite dogged resistance, Intel has followed in Microsoft's footsteps in becoming another huge technology business to fall foul of the EU's antitrust laws. This time the result is a record-breaking fine of 1.06bn euros ($1.45bn; £948m) - more than double the 497m euro fine Microsoft received.

The specifics of the case refer to the period between 2002 and 2007 when Intel had paid manufacturers and a retailer to keep using its products rather than switch to the likes of AMD. Other practices included encouraging manufacturers to delay or cancel AMD based products. The companies in question include Acer, Dell, HP, Lenovo and NEC, who received money in the form of hidden rebates, and Europe's biggest consumer electronics retailer, Media Markt.

According to the current verdict, Intel must cease these practices immediately (something one assumes they've long since done) and pay the fine within the next three months.

European Union Competition Commissioner Neelie Kroes, had this to say about the decision; "Intel has harmed millions of European consumers by deliberately acting to keep competitors out of the market for computer chips for many years." These are very strong words but ones that seem fair given that at the time AMD's processors were generally considered better than those of Intel yet AMD struggled to make financial and market share gains during this period.

Of course, this is something Intel strongly disagrees and in response, Intel President and CEO, Paul Otellini, said, "We believe the decision is wrong and ignores the reality of a highly competitive microprocessor market." He also insisted, "that there has been absolutely zero harm to consumers."

Whatever the truth, Intel will appeal the verdict, which will no doubt drag the case out for months or even years longer.

Link:

via BBC News

Skobbolop

May 13, 2009, 9:23 pm

That is why I don't have any Intel hardware in my computer :D

xenos

May 13, 2009, 10:06 pm

That should teach them...





Intel's behaviour has been disgusting frankly.

Williamn

May 13, 2009, 10:06 pm

Great to see Mr Chester back on the news desk!

Ed

May 13, 2009, 10:32 pm

@Williamn: Sadly it's just a one off for the time being.

supersizeme

May 14, 2009, 12:21 am

business as usual for intel then.....having said that, this kind of thing goes on in all types of business. Mergers and Monopolies commission, EU antitrust commission - wow - I wondered where all my tax went

Premfab

May 14, 2009, 12:52 am

The fine is chicken feed compared to what Intel made in profit for this 'crime'.





Sadly, all big companies do it. For example, Microsoft will blatantly copy a technology, drive out the competition and then pay the meagre fine. By this time, the competition has either given up or gone bust.





Intel's done the same here.

Chocoa

May 14, 2009, 1:57 am

@ Prem


You're right, all businesses do it (I Guess.) How else does a large business with a well saturated market, keep a preeminent position and competition at bay. (Other than the obvious of new products etc etc) - But by leveraging the market place. How far they go and get caught is the risk they accept in walking the line.





The EU does like to play big grumpy daddy though! - Shame the legal fees will come out of our empty pockets.

Wesley8ad

May 14, 2009, 2:34 am

Quite frankly I don't care what Intel does, if they make the best product for my money then they are what I buy. If AMD actually made CPU's that could compete with Intel then this wouldn't be an issue, but the fact is AMD has lost it and would rather focus their efforts on suing Intel rather than actually making good products.





Whats sad is that my Q6600 CPU from Intel is still better than AMD's most recent generation of CPU's. The fact is that Intel makes superior products, so I don't really care what kind of business practices they use.

xenos

May 14, 2009, 4:16 am

Wesley the point is that AMD couldn't make competing processors because Intel has spent the last few years trying to drive them out of the market, leading to reduced research budgets and in turn fewer future sales.





Frankly AMD have done amazingly well with Phenom II and now I hope to see them release more goodies to really push things forward. Competition is good remember.





And the EU sued Intel not AMD, they filed the complaint I believe but that is all!

aaron88

May 14, 2009, 4:38 am

@Wesley


If Intel didn't run this scam then AMD would have made a lot more money which they would have used for R and D resulting in better CPUs. This would force intel to develop better processors than they have now and they would have to sell them for less in order to compete so you should care about what intel does.





Remeber it was the Athlon XP processors that forced intel to sort out their act with the Pentium 4s.

mjaffk

May 14, 2009, 5:51 am

way to go, AMD! now make at least one good processor for notebooks... please?

GoldenGuy

May 14, 2009, 1:16 pm

Do these companies - and I'm asking this in all seriousness - have a sort of annual antitrust budget factored into their accounts : "Okay, we can only afford a billion dollar lawsuit this year guys."

Ed

May 14, 2009, 4:02 pm

@Wesley: This particular ruling refers to the period when AMD DID have the best processors - remember the Athlon XP and Athlon64? These were trouncing Intel's Pentium 4s but through the above practices Intel was able to use its financial clout to hinder AMDs ability to take advantage of its superior products.





Also, the latest Phenom's are better than the Q6600. Admittedly it's quite close but they are better overall.

Paul Leigh

May 14, 2009, 5:24 pm

I didn't buy AMD processors back in the day becuase they needed the Motherboards pacthing and windows patches, which in my experience, seems to be the underlying culrpti for many a problem. Of course, most of the time it was stable but when you had a problem that you simply couldn't resolve on an AMD machine, it all seemed to work fine on the intel boxes. I agree with the comments above, Intel products are and in my mind always were superior.





I know some of the comments here sya that the AMD processors were better but believe me, speed is only one measure of "better". Reliability, overheating, compatability all add up too.





I'm suspect Intel, like many other companies (you reading this Hagen Das) are really guilty of this type of anti-competetive behaviour but you all know full well, if that 1Bn fine stands - Its us, the consumers who ultimately have to pay it. Grrr....

hankb6d

May 14, 2009, 5:45 pm

@paul leigh





Summed it up in a nutshell there, but wait Hagen Das has always been poor ice cream for me, Sainsbury's Vanilla £1 a tub!!!

Ed

May 15, 2009, 6:31 pm

@Paul Leigh: I'm not talking about when AMD was producing Intel copies, I mean the entire five years or so that Pentium 4 was around. AMD quite simply ruled the roost by whatever measure you choose, which is why Intel took these anticompetitive steps during this period.





Ever since this period, AMD processors have been very good but currently Intel's are just better, at least if money's no object. Pound for pound, they're actually pretty even.

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