Robert Pogson

Intel was found guilty of anti-competitive practices. No surprise there. They did things other than selling on price/quality to exclude AMD:

“Intel gave wholly or partially hidden rebates to computer manufacturers on condition that they bought all, or almost all, their x86 CPUs from Intel. Intel also made direct payments to a major retailer on condition it stock only computers with Intel x86 CPUs. Such rebates and payments effectively prevented customers – and ultimately consumers – from choosing alternative products. Second, Intel made direct payments to computer manufacturers to halt or delay the launch of specific products containing competitors’ x86 CPUs and to limit the sales channels available to these products. The Commission found that these practices constituted abuses of Intel’s dominant position on the x86 CPU market that harmed consumers throughout the EEA. By undermining its competitors’ ability to compete on the merits of their products, Intel’s actions undermined competition and innovation. The Commission will actively monitor Intel’s compliance with this decision.”

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“Certain rebates can lead to lower prices for consumers. However, where a company is in a dominant position on a market, rebates that are conditional on buying less of a rival’s products, or not buying them at all, are abusive according to settled case-law of the Community Courts unless the dominant company can put forward specific reasons to justify their application in the individual case.”

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We shall see whether this improves AMD’s share. They make good CPUs at a good price and deserve a fair share of the market. Intel makes good chips, too, and they should be satisfied with competing on price and quality. Why the exclusive dealing if they were the best? It must be that they chose to exclude competition, which is illegal in their monopoly. Want to bet they operate this way globally? Legal action in the US may be influenced by this decision of the EU. Will the whole world prosecute them to demonstrate that crime does not pay? Not likely, but perhaps it will cause Intel to change. It is all good. We need healthy competition to drive innovation and lower prices.

UPDATE The Inquirer has a good summary of how this decisiion fits in a rainbow of decisions around the world leading to a pot of gold in the USA. Essentially, this looks like the cases in Japan, Korea and now the EU seem to be stepping stones with gathering piles of evidence that can be used in the cases in the USA. While courts in the USA may not accept all this evidence for technical reasons, they may sway the court if Intel denies knowledge or has lost the e-mail etc. These cases likely will be very useful in the civil action where standards of evidence are different.If AMD lost customers everywhere because of exclusive dealing with Intel, that should be convincing. Intel cannot seriously expect to sway coourts with claims of superiority in technology and business smarts when they needed to exclude AMD from the market to do business.

UPDATE Now that Intel is under close scrutiny on the hardware end of Wintel, it is interesting to see them adjust on the software side of things. Seeing growth in smart phones and netbooks, Intel is pushing Moblin, a distro of GNU/Linux. see NYTIMES. That should drive a spike through the heart of Wintel. There are other ways to compute/compete. Good for Intel on this one. I hope they concentrate on providing good price/performance instead of wasting everyone’s energy by messing with the competition.