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Federal Trade Commission Files Suit Against Intel For 'Anticompetitive Tactics'

The U.S. Federal Trade Commission (FTC) today announced that it has filed suit against Intel, claiming that the company has "illegally used its dominant market position for a decade to stifle competition and strengthen its monopoly." The complaint focuses not only on Intel's actions in the CPU market to shut out competitors such as AMD, but also on newer, similar actions in the graphics chip market.

The FTC's administrative complaint charges that Intel carried out its anticompetitive campaign using threats and rewards aimed at the world's largest computer manufacturers, including Dell, Hewlett-Packard, and IBM, to coerce them not to buy rival computer CPU chips. Intel also used this practice, known as exclusive or restrictive dealing, to prevent computer makers from marketing any machines with non-Intel computer chips.

In addition, allegedly, Intel secretly redesigned key software, known as a compiler, in a way that deliberately stunted the performance of competitors' CPU chips. Intel told its customers and the public that software performed better on Intel CPUs than on competitors' CPUs, but the company deceived them by failing to disclose that these differences were due largely or entirely to Intel's compiler design.

The FTC is seeking a variety of remedies in the lawsuit against Intel, including orders preventing the company from using threats, bundled pricing, and other tactics to hamper competition or manipulate prices.

The news comes as Intel prepares for a preview event tomorrow highlighting forthcoming Arrandale processors. Speculation as centered on Apple's possible use of these chips in the next generation of its notebook computers, although a recent report claimed that Apple has refused to accept Intel's standard Arrandale package incorporating the company's integrated graphics chipset.

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28 months ago
Does this include Intel's and NVIDIA's spat over Intel refusing to license Nehalem to NVIDIA so they can continue to make chipsets?
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28 months ago
I'm surprised it took this long. I thought if the Fed was going to pursue this they would have done it 10+ years ago. Their silence over the years has been implied acceptance of their practices.
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28 months ago
I have been wondering about this for a while now. Seems like Intel's on top of the world as I don't see any companies using the AMD processors in their consumer notebooks and desktops anymore. I certainly don't want Intel to become Microsoft whereas the majority uses Intel like they are forced to use Windows.
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28 months ago
You would think the FTC would have more pressing issues to deal with right now. But I guess everyone knows the Intel name and the Feds probably think this is a positive PR move from them right now.
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28 months ago
This should have happened years ago. As bad as Microsoft is [and IBM before them, if there's any old-timers here], Intel is worse. That's why the 2006 decision to go Intel was so disappointing to me - Intel makes Microsoft's aggressive business tactics look like Barbie.

I hope this suite has some teeth in it, and gets the job done. Intel has caused a lot of problems in this industry and it's about time they paid for their illegal ways.

/vjl/
Rating: 0 Positives / 0 Negatives
28 months ago

In addition, allegedly, Intel secretly redesigned key software, known as a compiler, in a way that deliberately stunted the performance of competitors' CPU chips. Intel told its customers and the public that software performed better on Intel CPUs than on competitors' CPUs, but the company deceived them by failing to disclose that these differences were due largely or entirely to Intel's compiler design.


Regarding this quote, if Intel's CPUs with Intel's chipsets work better in combination than competitors CPUs with Intel's chipsets, good. Shouldn't this be expected? If Intel has optimized their hardware to work better together, great.

If, with no extra engineering, competitors CPUs don't work as well with Intel chipsets, this is not anticompetitive. This is just a side effect of separate entities creating separate components of an entire system.

If there really is extra, unnecessary engineering put into the compiler to purposely hinder third party CPUs performance, this is anticompetitive. This is what needs to be proven.
Rating: 0 Positives / 0 Negatives
28 months ago

This should have happened years ago. As bad as Microsoft is [and IBM before them, if there's any old-timers here], Intel is worse. That's why the 2006 decision to go Intel was so disappointing to me - Intel makes Microsoft's aggressive business tactics look like Barbie.

I hope this suite has some teeth in it, and gets the job done. Intel has caused a lot of problems in this industry and it's about time they paid for their illegal ways.

/vjl/


amd has been suing intel for things like this for a while, so its a surprise to see how long it took
Rating: 0 Positives / 0 Negatives
28 months ago
Wow! I thought after a certain amount of time you weren't allowed to sue!
Rating: 0 Positives / 0 Negatives
28 months ago

Regarding this quote, if Intel's CPUs with Intel's chipsets work better in combination than competitors CPUs with Intel's chipsets, good. Shouldn't this be expected? If Intel has optimized their hardware to work better together, great.

If, with no extra engineering, competitors CPUs don't work as well with Intel chipsets, this is not anticompetitive. This is just a side effect of separate entities creating separate components of an entire system.

If there really is extra, unnecessary engineering put into the compiler to purposely hinder third party CPUs performance, this is anticompetitive. This is what needs to be proven.


This is the problem, not Intel's competence at making chipsets and hardware:

The FTC's administrative complaint charges that Intel carried out its anticompetitive campaign using threats and rewards aimed at the world's largest computer manufacturers, including Dell, Hewlett-Packard, and IBM, to coerce them not to buy rival computer CPU chips. Intel also used this practice, known as exclusive or restrictive dealing, to prevent computer makers from marketing any machines with non-Intel computer chips.

In addition, allegedly, Intel secretly redesigned key software, known as a compiler, in a way that deliberately stunted the performance of competitors' CPU chips. Intel told its customers and the public that software performed better on Intel CPUs than on competitors' CPUs, but the company deceived them by failing to disclose that these differences were due largely or entirely to Intel's compiler design.
Rating: 0 Positives / 0 Negatives
28 months ago
My guess is that any financial penalties or remedies that Intel could be forced to pay will have ZERO impact for the average consumer at an Apple Store. If anything, the FTCs actions could help spur competition, lower prices and let Apple enjoy higher margins. I see the nicest rewards coming for Apple stock holders.
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