Yesterday Intel was the target if the biggest ever fine handed down by the European Union and AMD couldn’t be happier.
The European Commission yesterday imposed a fine of $1.45 billion on Intel as punishment for what it felt was anticompetitive behavior designed to push rival AMD out of the market. While Intel’s Paul Otellini has said the company will be appealing the fine AMD fully supports the decision, of course, and maintains that Intel’s pricing practices broke the law.
"After an exhaustive investigation, the EU came to one conclusion--Intel broke the law and consumers were hurt," Tom McCoy, AMD's executive vice president for legal affairs, said in a statement. "With this ruling, the industry will benefit from an end to Intel's monopoly-inflated pricing and European consumers will enjoy greater choice, value and innovation."
In an official statement, AMD's president and CEO, Dirk Meyer labeled the ruling an important step toward restoring the market's competitive conditions:
"Today's ruling is an important step toward establishing a truly competitive market," said Meyers. "AMD has consistently been a technology innovation leader and we are looking forward to the move from a world in which Intel ruled, to one which is ruled by customers," he finished.
Intel maintains that it acted well within legal boundaries by offering rebates to manufacturers who agreed to obtain the majority of their processors from Intel as well as paying manufacturers to either delay or cancel the launch of AMD-based products.
This week, speculation has been mounting as to whether or not Intel will face the same level of scrutiny at home following statements from Christine Varney, the DOJ's top antitrust official. In a speech to the Center for American Progress, Varney said the Department of Justice will be "aggressively pursuing cases where monopolists try to use their dominance in the marketplace to stifle competition and harm consumers.”
[UPDATED] Edited to include comments form AMD's Dirk Meyer.
i'm not a fan of AMD products, Intel/Nvidia user myself, but Intel SHOULD pay the fine for what they did to European market...
of course they're happy
of course they're happy
i'm not a fan of AMD products, Intel/Nvidia user myself, but Intel SHOULD pay the fine for what they did to European market...
Fixed.
Thanks for taking the time to write this article and point out the obvious.
The decision for Intel to appeal or pay the fine will cost them a decent chunk of change. This hurts profitability, and thus both shareholder returns and their credit (in a time where every company needs to hold onto every bit they can).
Also, I believe the cost to Intel's reputation would be great (hence the appeal). After all, outselling the competition and having superior products sounds great - but doing so because you had to pay your customers to not use or delay use of your competitor's product sounds like you knew they had a decent product.
True, it might be nice for AMD to see an infusion of cash for this, but how do you prove the potential lost income for a market that your company wasn't allowed to participate in?
Myself, if I were AMD, I'd just go after perpetual rights to the x86 architecture for whomever fabricates their chips. No direct cost to Intel, only a cost of future income.
Haha.
The truth is, we as customers will probably not see any benefits from this at all.
That's $1.45 billion less to go into research and development.
With less R&D, me may as well go back to 10MHz CPUs.