Antitrust Investigation. Not Microsoft. Intel

The Attorney General of New York has issued subpoenas to Intel, seeking information about whether Intel unlawfully compelled their customers to exclude rival AMD from the market for certain computer chips.


At issue in Cuomo's probe is whether AMD has a fair chance to supply its X86 computer processing units for desktop and laptop computers and servers. Cuomo says Intel commanded 80% of the $30 billion market.

In 2005, AMD filed a lawsuit saying Intel bullied major customers — PC makers like Dell (DELL)— into exclusive deals and offered secret rebates.

The lawsuit alleged anti-competitive practices in several countries, including Britain, Germany and Japan.

Intel, which commands three-quarters of the worldwide microprocessor market, has denied AMD's allegations and defends its business practices as legal and beneficial to consumers.

It's very difficult to sort through claims of anti-competitive practices on this scale. Words like "bullied" and "fair" are very subjective. Deals are routinely and legally made to equip machines with only one brand of chip. Computer makers are not required to offer more than one brand of chip.  The accusation of secret rebates to ensure brand exclusivity is the interesting wrinkle here. That can be proved -- or disproved-- fairly readily. If those payments exist, they will be found, as publicly traded companies really can't have any transactions that are "secret,"  when you get right down to it.


Via:  USAToday
blog comments powered by Disqus