Intel pleads for €1bn EU fine to be overturned, is denied

Remember when Intel gave rebates to PC makers who bought its chips? The world’s largest computer chip maker has now lost its attempt to overturn the ancient €1bn fine from the European Union over its anticompetitive war with rival AMD. The record €1.06bn fine was handed down by the European Commission’s antitrust division …

[Arctic fox]

To be quite honest I had not realised that the beggers.......

...........had not yet paid up. Any chance that it could include a substantial interest payment on top by way of making the point that time wasting and frivolous attempts to avoid their very clear obligations should not be permitted to pay?

[P0l0nium]

Re: To be quite honest I had not realised that the beggers.......

They paid it when it was levied in 2008 and accounted for it in their earnings report.

[Arctic fox]

@P010nium "They paid it when........."

Thanks for that, I was not aware. However, I have to say that yet another example of "BigCorp" dragging out a case for as long as possible even when they must have known that they were toast over the AMD business is not very edifying. One can just hope that their legal costs were as sky-high as possible.

[P0l0nium]

Re: @P010nium "They paid it when........."

There were 2 grounds for the appeal

1) That what they were doing was no different to a "car dealership" arrangement

(did you ever try buying a BMW from a Ford dealer?).

2) That the commission ignored key evidence from Dell, and the European commission ombudsman agreed with Intel on that.

Frankly, all AMD needed to do was to set up their OWN dealerships (with associated marketing costs) and the playing field would have been level. But instead they decided to whine to the commission about being excluded from Intel sponsored dealers.

Paying kickbacks to the German dealer .... OK, that WAS illegal :-)

[WonkoTheSane]

Re: @P010nium "They paid it when........."

"Paying kickbacks to the German dealer .... OK, that WAS illegal :-)"

There is precedent however - search for "Lockheed and Luftwaffe"

[Anonymous Coward]

Re: @P010nium "They paid it when........."

Really...

You think Intel as a market-share monopoly with the inferior product going to the biggest PC and server manufacturers in the world and saying, "You can have 50% off all our chips and we'll pay a big chunk of your advertising... as long as you refuse to advertise or even make a single AMD product" is not an illegal abuse of market position?

A little surprised about that. It seems pretty blatant.

You think somehow there's anything AMD as the smaller company with far less cash could have done to counteract that?

That "car dealership" analogy is certainly a pile of horsecrap and I can't see it has any relevance.

Just to be clear the industry still suffers as a result of this. AMD came out with some brilliant chips, with worthwhile improvements. The first to do them. No. The first to do them in the x86 world. Yes. Point to point memory architectures, on chip memory controllers, 64 bit. The price was keen and the performance was great (especially if you removed the hard coded check for Intel processors that Intel put into the icc compiler).

They caught Intel with their pants down working instead on operations per clock rather than Intels dash for the GHz.

They could have been a contender. They should have got a ton of business, accrued a mightly war fund for R&D and we'd have a good chance right now of having 2 competitors slugging it out in the high end CPU business and making each other improve day in day out.

Intel threw money at the problem and used about every anti-competitive practice in the book. They won. After they won some people noticed and they had their wrists slapped. Very, very gently.

[Anonymous Coward]

Re: @P010nium "They paid it when........."

"You think somehow there's anything AMD as the smaller company with far less cash could have done to counteract that?"

They could have entered into a deal with Microsoft to name their chips after the operating system, got Microsoft to send round reps to young impressionable sales people to push their product and give kick backs to those sales staff of around a fiver per AMD machine they sold.

Oh wait...they did, welcome to the Windows XP machine powered by the AMD XP chips. Designed hand in hand with Microsofts revolutionary new operating system an AMD XP1800 runs at a lower clock rate but offers the same windows performance of an intel chip running at 1.8Ghz, at least that's what the rep that MS sent to the shop I worked in told me to say in order to get my bonus money when I was a PFY.

AMD was buying my beers between the ages of 17 and 19...it was a good arrangement, but I refused to sell an Intel machine at all because they didn't give me anything. It does seem a little unfair that intel are the ones being fined when AMD pretty much did the same thing (only on a smaller scale due to having less money) but at the end of the day AMD bought me beer, so fuck Intel.

[Captain Scarlet]

Re: @P010nium "They paid it when........."

AMD brought you Beer, man all i got was some commission for selling finance contracts on Maxx PC's which was then removed and no incentive for it at all (Forms took forever to fill out and often the customer could not get the finance package so were often turned down).

[Oh Homer]

Re: "all AMD needed to do..."

...was engage in the same racketeering as Intel, but with far less resources and thus no hope of succeeding, which is a somewhat disingenuous "solution".

[W. Anderson]

Re: @P010nium "They paid it when........."

The "car dealership" analogy is quite flawed, and the ombudsman did "not" agree with Intel plea.

I suspect that there are Intel minions commenting in tech press as well as those loyal in supporting Microsoft. Could this also be a US and UK anti-European (continent) sentiment as well?

[Captain Scarlet]

Re: To be quite honest I had not realised that the beggers.......

Reminds me of SCO v. Novell

The moment you think its dead something tries to kickstart it

[seven of five]

How much of this money goes to AMD?

How much of that fine will be awarded to AMD, who were unfairly treated?

SCNR

[P0l0nium]

Re: How much of this money goes to AMD?

AMD settled for a Billion plus the rights to make X86 in Fabs that they didn't own.

Without that deal, AMD would now be history because they sold their Fabs to the Sheikh of Abu Dhabi.

[Arctic fox]

@P010nium "Without that deal........."

It is far from unlikely that were it not for the demonstrable and very considerable damage to AMD that Intel's illegal tactics caused AMD would not have had any need to sell their Fabs to SAD.

It is further unlikely that the deal they settled for was anywhere near enough to compensate them for the long term damage that Intel's behaviour caused, however the situation they were in meant they had little choice but to accept the deal. This situation may very well have contributed substantially to the decision in the end to off-load their Fabs. In total Intel has ponied up about 2 billion but gets to keep a monopoly that earns them vastly more than that. You'll pardon me if I remain unimpressed.

[Anonymous Coward]

Re: How much of this money goes to AMD?

And Transmeta.

[Anonymous Coward]

"rebates to PC makers who bought its chips"

"Intel gave rebates to PC makers who bought its chips"

That should read *exclusively* bought its chips (ie didn't buy AMD).

See also: http://www.theregister.co.uk/2010/07/26/after_the_dell_settlement/

and

http://www.sec.gov/news/press/2010/2010-131.htm

[Anonymous Coward]

Re: "rebates to PC makers who bought its chips"

They killed off Transmeta by getting Sony to pull the plug on their Transmeta laptop.

So while the Transmeta CPUs were a bit odd and new, they would have improved. Instead we're stuck with x86.

[Big_Ted]

Hmmmmm

They should have the fine adjusted upwards allowing for inflation plus extra costs awarded against them to cover the costs of the EU since the fine was awarded.

If not then these companies will always just hold on as long as possible even if they accept guilt internally just to cut the real cost of the fine over time.

[Version 1.0]

Fines don't work

The problem with fines as a method of punishing criminal conduct is that they don't work - the fine simply becomes a cost of business (tax deductible?) and the companies re-arrange the deck chairs and continue on the same path.

We've seen this pattern now in all the big industries, pharmaceutical, banking, chemicals, telecommunications (Worldcom aka Verizon) etc. Until real pain is inflicted for criminal conduct then nothing will change.

[Arctic fox]

Re: Fines don't work

Agreed. The only thing that would work is personal fines on the directors plus jail time. The damage that those bastards cause society demands nothing less.

[Duncan Macdonald]

Double the fine

If a company makes an unjustified complaint about the size of a fine levied on it then that fine should be doubled. This would reduce the number of unwarranted appeals.

[monkeyfish]

Re: Double the fine

Well, it would take double or nothing gambling to a new level, if nothing else.

[Alan Denman]

The sorry tale of protctionism..

extends to keeping out Linux and x86 alternatives.

Remember, Microsoft once supported Mips in Windows NT.

Obviously that was protectionism too. I bet x86 manufacturers Intel mainly had a big stick out on that one.

And even now ARM, the mips like chip designer is getting protectionist strategies shoved down their throats. The smaller partners are certainly being encouraged to move to Intel.

[Anonymous Coward]

I hope the EU are charging interest on that?

[asdf]

the irony

Yeah rebates help kill off high margin competitors but its a fairly useless tactic against low margin high volume competitors (ARM licensees) where Intel is getting its ass kicked. Yes they have come late to the mobile party but they will fundamentally have to change as a company to be as relevant going forward as in the past.

[ecofeco]

Schadenfreude

I haz it.

[dan1980]

I wonder - are those who agreed to these practices not also guilty of something or other?

(Maybe they are and have already been fined accordingly - I don't know!)