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EU Airs Out Intel's Dirty Laundry

Intel has long contested the $1.45 billion fine from the European Union's antitrust division and yesterday, the EU responded to the appeal Intel filed in July by making a "non-confidential version" of its ruling final.

So what do we know now that we didn't know before? When the EU announced its ruling before the summer, it said that Intel was guilty of anti-competitive practices but now, we're finding out just what Intel was up to and good gracious if it doesn't paint Intel in a decidedly unflattering light.

The EU release includes details of rebates with manufacturers such as Dell, Lenovo and HP. Check out the deets of some of the deals below.

Rebates paid to Dell from December 2002 to December 2005 were conditioned on Dell purchasing exclusively Intel CPUs. For example, in an internal Dell presentation of February 2003, Dell noted that should it switch any part of its CPU supplies from Intel to its competitor AMD, Intel retaliation "could be severe and prolonged with impact to all LOBs [Lines of Business]."

The deal with HP was a little different. HP was awarded rebates provided the company adhered to several unwritten requirements. First and foremost, HP was to purchase at least 95 percent of its business desktop system from Intel. Second, although HP could purchase the remaining 5 percent from AMD, this was subject to further restrictive conditions. These included only selling AMD-based business desktops to small and medium enterprises, only via direct distribution channels (rather than distributors), and on HP postponing the launch of its first AMD-based business desktop in Europe by six months.

An internal email from HP and dates September 2004 reads, "You can NOT use the commercial AMD line in the channel in any country, it must be done direct. If you do and we get caught (and we will) the Intel moneys (each month) is gone (they would terminate the deal). The risk is too high."

Similar restrictions were places on deals with Acer and Lenovo with the former postponing the launch of an AMD-based notebook from September 2003 to January 2004.

Check out the full release from the European Union by clicking here.

  • SpadeM
    Let's see the "EU is leaching money of the poor and righteous American company" argument their point now.
    Reply
  • Jerky_san
    Wow that is some pretty dirty laundry..
    Reply
  • charlesxuma
    i'm actually considering throwing away my core i7 after this article. thats it, i'm going all AMD next build. I SWEAR!!
    Reply
  • astrodudepsu
    Certainly some shady business practices for sure. Still maintain that a loosely coherent body like the EU has no basis for the fine.
    Reply
  • moazbhutta
    intel the classic X Wife! Damn if you Damn if you dont!
    Reply
  • dheadley
    Was there an actual need to release the details to convince someone out there that anti-competitive practices were being used? I mean in the computer industry has any company ever achieved the dominant market share in any segment without using these practices of rebates, volume discounts and volume licensing deals to extort "loyalty" out of the manufacturers.
    Reply
  • soo-nah-mee
    I hope this results in more sales for AMD. It's not that I hate Intel, I'd just like to see more balance in the competition for the consumer's benefit. AMD deserves much more credit than their commercial sales reflects, and this story shows a major reason why.
    Reply
  • soo-nah-mee
    ..in fact this just pushed my over the fence. I'm going to order a Phenom II X4 965 to upgrade my 720 right now.
    Reply
  • crisisavatar
    This is why my money goes to AMD when they have competing parts.
    Reply
  • charlesxuma
    soo-nah-meeI hope this results in more sales for AMD. It's not that I hate Intel, I'd just like to see more balance in the competition for the consumer's benefit. AMD deserves much more credit than their commercial sales reflects, and this story shows a major reason why.
    i completely agree with you, thats what i'm gona do from now on, i'll be purchasing AMD/ATI only products, and hopefully others will too, doing this on large scales will balance competition and therefore even intel dedicated fans will benefit. (LONG LIVE THE UNDERDOG)
    Reply