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Intel in Antitrust Trouble in Japan
vincecate writes "The Japan Fair Trade Commission has ruled that
Intel violated antitrust laws in Japan.
Giving customers discounts based on the volume of your products
they purchased is good business.
However, Intel was adjusting customer discounts
based on the volume of competing products they purchased,
which is not legal.
After the ruling,
AMD responded saying, "We encourage governments around the globe to ensure that their markets are not being harmed as well".
While
Intel responded
saying, "Intel continues to believe its business practices are both fair and lawful."
I know very little about law in this area. Is it the same in the U.S. and Europe? I would like to think it is but then considering today's climate I wouldn't be surprised if you it wasn't!
Oh regarding Intel's comment that it "... continues to believe its business practices are both fair and lawful.". It might just be legal in some countries but how is it fair to use your dominant position to prevent other companies from being able to compete with you? A statement like that is just a bare faced lie. If the situation was reversed you can bet Intel would kick up a fuss. I'm not saying I'm surprised it is just irritating.
Intel? Antitrust!? I don't believe it! I'd sooner believe that Linus Torvalds switched to a new OS!
Specialization is for insects. -Heinlein
...see that fine line between shrewd business practices and predatory, monopolistic racketeering?
See how you and Microsoft are on the same side of it?
That's a bad thing.
While Intel responded saying, "Intel continues to believe its business practices are both fair and lawful."
That's how PR hacks are taught to respond. When, for example, your CEO is stealing money, your PRish role is to go out and with a straight face say: "The core Value of our company is Honesty. We will introduce a Business Codex to emphasize our commitment."
Computer manufacturers are already being sued in anti-trust cases...in Ja- oh, never mind
I am trolling
but then again, if Intel wants to do business in Japan, I guess they should also abide by the rules. I'm sure AMD are happy.
Free Firefox news reader.
Does this mean that we get to start referring to Intel as a "convicted monopolist" in every /. article about the company, just like we do for Micro$oft??
That's awesome!
I think you missed the point slightly, it goes something like this:
Intel: "if you buy 1 chip it costs $500"
Intel: "But if you buy 10 it costs $450 per chip"
Intel: "If company X wants to buy 10 then it will cost them $480 per chip because we found out they bought an athlon chip last week"
THAT is not on!!
Intel in Antitrust trouble... in Japan!
The meme works.
Can someone tell me honestly what's wrong here? Intel are the ones who have control over their product. They get to sell their products and define how much it sells for. Why are governments getting involved?
Obviously if a company is buying more of a competitor's products then they're buying less of yours, so your own are more expensive to them because they are buying in lower quantities. that is simple grade school economics."
The problem arises when somebody tries to use their position as the established leader to keep other companies from establishing a marketshare, thus using their dominance to maintain a monopoly. Not as much of a problem with Intel as it would be with a company like Microsoft (as AMD is a very strong competitor), but still not a good idea to let bad practices get started.
Again, basing your prices off how many of YOUR chips they buy is okay. What this alleges is taht they are also factoring in how many of the competitor's chips they buy, which is not. How many AMD chips a company buys is none of Intel's business, and shouldn't affect prices.
Simple example. Company A makes 100,000 computers, and uses Intel for 50,000 and AMD for 50,000. They should be charged the exact same rate as Company B, which makes only 50,000 computers but uses Intel for all of them. The accusation is that Intel would instead charge Company B a lower rate, because while they purchase the same volume they don't purchase any from AMD.
As somebody else said, the carrot is legal, the stick is not.
now we need to apply this reasoning to the case of Microsoft's unfair practices in regards to OEMS wanting to offer the choice of Linux or MS to the customer...
Donald 'Duck' Dunn: We had a band powerful enough to turn goat piss into gasoline.
They gave their customers lower prices if they guaranteed not to buy their rival's chips. To my mind, that is unfair.
Justin.
You're only jealous cos the little penguins are talking to me.
Okay, I'll try explaining this in easier terms.
Intel to customer: "If you buy 1 of these, it will cost you 100$, if you buy 10, you will get them for 50$ each".
So far, it's fair enough.
Intel to customer: "However, for each product you buy from AMD we will lower our discount. Buy one single item, and our product will cost you 60$, even if you buy 10 of them."
Now, this is unfair, since the customer would buy 10 of whatever it was from Intel nomatter how many he might buy from AMD. See the difference?
-- A good compromise leaves everyone mad. --Calvin and Hobbes
its easy: Intel Pentium 4 530 3.00GHz: 176 imagine you and me we are both retailers. i buy 1000 of them, get them for 100k . you buy exactly the same 1000 but get them for 150k . why? because you also sell amd stuff. still think everythings working right?
-- Karma: beyond good and evil - mostly affected by posting political
Actually, from the way TFA explained it, it sounded a little more like this:
:P
Company A and Company B buy 500 intel processors.
Intel goes back to those companies and says "Hey, we'll pay you money^H^H^H^H a 'rebate' - if you promise not to buy any AMD chips for a while."
Company A says "ok" and gets the cash, Company B tells them to go to hell, and doesn't get squat.
But who reads TFA around here?
The role of anti-trust legislation is the protection of consumer choice. Intel's discount was directly targeted to prevent an alternative.
Monopolies are bad, irregardless of whether they are owned by the state or privately. People living under communism had no choice, too. All they had was one-two products from one state-owned monopoly.
BTW, I assume that people are able to distinguish between cheese and CPUs on their own.
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Clearly, Intel has been trying to take advantage of the weak dollar to expand its market in Japan, and the ever-watchful Japanese regulatory agencies moved to stymie foreign intrusion into one of their most tightly protected markets.
Looks to me like this could be the opening salvo of a new trade war. I just hope it doesn't affect the price of ramen.
But, if you read the article, that is not what was happening.
Rather, the scheme was that if I was buying 1,000,000 intel chips, and you were buying 1,000,000 intel chips plus 500,000 AMD chips, my intel chips would be cheaper. Ie it is not an issue of bulk discounts, but rather of bribes not to buy anything from AMD.
Now, pure free market theory would say this is fine, evenetually Intel will run out of money and the 10th firm to be built on the ashes of AMD will win out. However, that could take 50 years or perhaps longer than the integrated circuit industry will exist for. Anti-monopoly laws exist on the theory that a small distortion of the free market to speed up that attrition process and maintain some competition now is a general win.
_O_
.|< The named which can be named is not the true named
"Obviously if a company is buying more of a competitor's products then they're buying less of yours, so your own are more expensive to them because they are buying in lower quantities. that is simple grade school economics."
Volume discounts are fine. The problem occurs not when you say "Buy more than 5,000 of my widgets and you get a discount. Buy less and you don't." The problem is when you say "If the number of my widgets in your shop drops below %80 of your total I will cancel the discount." Attempting to coerce your vender to not carry your competitors' widgets is anti-competative.
-- "It was as if the paint factories had decided to deal direct with the art galleries." - Thursday Next
There's no problem for anyone with offering cheaper prices for people who buy larger quantities of your own product (as long as you're allowing anyone who buys in those quantities to get those prices, of course). But that's nothing to do with the case reported. Offering cheaper prices to people who buy larger quantities of a competing product is wrong.
"Little does he know, but there is no 'I' in 'Idiot'!"
Intel giving discounts based on volume is not the issue, but Intel adjusting customer discounts based on the volume of competing products they purchased is the issue.
But if Intel really believes this is "fair and lawful", why is it that Intel does not use written contracts for these deals?
Mod you damned right! IMO this was the point where the DoJ dropped the ball. How the hell can that be acceptable?!
J.
You're only jealous cos the little penguins are talking to me.
IANAL, but I thought that to be in a antithrust situation, you had to be barring others from market, and also have a significant market share (i.e more than 80%)
In the case of Intel, the consumer has a real choice, in AMD for home pc's, and POWER or AMD for servers. So as long as there is a real choice, there is competition, and IMO, there is very hard competition between Intel and AMD. So I think it's strange that Japan focuses those over Microsoft or other monopoles that is less challenged.
Assembling etherkillers for fun an profit
"Intel continues to believe its business practices are both fair and lawful ,in spite of all evidence to the contrary."
If they keep on going like that, pretty soon we'll have Intel turn into a religion.
Just
More to the point, we don't live in a world where one usually sees the price depend on how few of the competitor's product you bought instead of how many you bought from them.
For what it's worth, there have been rare occasions when buying more of an item might lead to higher per unit prices.
One example involved Sony when they first started out. According to an article in one of the business journals about 20 years ago (I think it was Forbes), when Sony showed their transistor radios to one big chain, the chain asked for many more radios than Sony expected. The price Sony quoted was higher per radio than the price they quoted for a much smaller quantity of radios. The buyer from the chain was very surprised and asked why. Sony said that with an order that big, they would have to build a bigger factory to produce them and they would have to earn enough to help pay for additional production capability.
On the whole this does seem like a rather gross abuse of Intel, a company I have previously supported, well not so much supported but remained indifferent towards. However this pricing scheme seems rather off, not just in fairness, but how in the world would they be aware of the volume of a competing product that a company has purchased? Perhaps there's something simple I'm missing (more than likely) but I don't see any realistic reason why Intel would know extensive information about such things, though I'm sure they'd want to know. Anyone care to enlighten me?
Intel continues to believe its business practices are both fair and lawful.
And I believe my actions are both fair and lawful... Now, to go rob that bank...
Try to hack my 31337 firewall!
Offering cheaper prices to people who buy larger quantities of a competing product is wrong.
;-) So if I buy my Athlons in bulk i can get cheap Celerons? Point's valid tho, but the other way around.
Not to mention stupid
People replying to my sig annoy me. That's why I change it all the time.
umm no because those "bad and evil" governments would also but in in this case for false advertising.
Either goverments stay uninvolved with business practice as you wish and companys are allowed to charge what they want, strongarm who they want and sell cheese as CPU's or you have a regulated system were there are laws against strongarm tactics and selling fakes. I.E. cheese as CPU's ETC.
Saying Apple is better than MS is like saying Botulism is better than rabies.
It's a rich and vibrant culture those Japanese have, I tell you.
StupidChildren...the reason jesus is crying
I mean the Intel CEO called Dell's CEO and said: "If you offer a single system with AMD processors we'll raise the prices on our stuff". Of course both will deny.
I strongly suspect something like this: in big business relationships, you can never be paranoid enough. The reality is much worse than anything that most people could start to imagine.
For example, AMD has been the only source for mobile 64 bit processors for quite some time. But Intel can prevent Dell from entering the market until they are ready, and maybe also pressuring Microsoft in the same direction, so that both Dell 64 bit portables and 64 bit Windows will be available only when Intel has all 3 catergories (mobile, desktop and servers) covered.
..(from tfa) So just what type of antitrust principles are accepted? I would have to say acceptance has nothing to do with forcing-it-down-your-throat, other than accepting the fact your being screwed.
Join the Slashcott! Feb 10 thru Feb 17!
Yes, discounts for quantity happen, and are legal ... but what if the owners of Catalog "A" charged you more for your 100 widgets than they charged me for the 100 I bought, just because you also bought widgets from Catalog "B". That is not only unfair pricing, it is an attack on "B".
Japan has no problem with the quantity discounts, but they are justifiably annoyed that Intel appears to have two prices for the same quantity of chips - one for Intel-only customers and one for customers who also buy AMD chips.
Intel's actions would be like Microsoft selling you the install CD's which scan you computer for linux. If it finds Linux you would have to enter a 'special' serial number that would of course cost you more than the 'standard' serial you purchased with the install disks.
Simple example. Company A makes 100,000 computers, and uses Intel for 50,000 and AMD for 50,000. They should be charged the exact same rate as Company B, which makes only 50,000 computers but uses Intel for all of them.
Close but no. Intel shouldnt charge Company A the same as Company B for the same 50,000 units. Intel *should* charge Company A the same for those 50,000 units as they would if they didnt know about the 50,000 AMD units. Bit of a difference.
Intel is well within its rights to charge Company A and Company B different prices, but NOT for certain anticompetative reasons. Its the same as Intel refusing someone business - they can refuse anyone business but NOT for reasons like race, gender etc.
Microsoft doesnt charge a different Windows OEM price based on if the OEM wants to ship with alternative OSes, it just removes the option of OEM licenses altogether. This is perfectly legal (you are afterall allowed to not renew agreements as you feel fit and the OEM is free to purchase off the shelf at the same rates as anyone else) and isnt covered under this case at all.
If they get in to trouble in the US they could make campaign contibutions to a candidate that will let them off the hook. It worked for Microsoft.
GETPKG - Package Management for Slackware
In other news, rapists take pride in practicing safe sex...
...that the itanium is a wildly successful product, too.
in other news, intel continues to believe the f00f and pentium fdiv bugs were really just user error...
Yeah, in those cases you are buying quantities that affect demand on the level of an entire market.
It's just like buying a ton of a thinly traded penny stock. You could easily cause the price to double or triple.
I've had enough abrasive sigs. Kittens are cute and fuzzy.
After doing what Intel did, I can't believe someone would say this with a straight face. What a world we live in.
I'm not surprised at all that Intel has such practices with its customers.
Two years ago, in the company I worked for, we needed to buy 600 cheap servers from Dell for an embedded application that we had to install at our clients. The price was really very important. If we couldn't get them at the right price, our project was not going to make it.
Dell did everything to lower the price. I remember they went down as much as 50% but it was still not enough.
We were about to cut the project when Dell called us and told us that the only way to reduce the price of the 600 servers further was if we signed some sort of paper saying that we used AMD processors in our previous project and this was a replacement project. This way they could get a big rebate from Intel under a certain program provided by Intel.
I just couldn't believe that Intel was ready to go that far...
A hungry bear does not dance!
How did you decide that this has to do with Japan protecting its markets (from what? If US companies can't sell processors to Japan, where will they go for chips to drive their computers? Toshiba?)?
1. Intel was not dominating Japan. AMD was doing ok there.
2. Intel suddenly beats the snot out of AMD in Japan
3. Japan investigates, for some reason, learns that Intel was raising the price of Intel processors sold to any company that also bought from AMD
4. Investigation hits the press/slashdot.
Read the article... heck just skim the article for years. This started way back before the dollar was weak. Like, when the dollar was really really strong. Unless Intel has invented time travel, the price of the dollar has less to do with this investigation than the price of eggs in China.
I wonder, though... if Intel was doing this same thing with Dell. Might explain why Dell won't leave Intel... at all. Even though the Opteron has lately been a better product, and one for which there is significant demand.
Gee, surely it had nothing to do with Microsoft's $25,000 donation to the National Republican Congressional Committee, or their $867,000 in Republican campaign contributions. Surely not. I mean, that would be bribery, right? Or would it be extortion on the part of the National Republican Congressional Committee, since they asked for (and by MS' own admission, probably received) another cool million on top of it? Nobody made a big stink about it at the time except some pesky "liberal media elites", so guess what? We all consented.
They will never stop until somebody makes the
No, that's the point, market power costs money to excercise (eg Intel has to pay people not to buy AMD, or keep it's prices below reasonable cost plu margin or whatever), so given a perfectly stable open market etc. etc. eventually the little guys who keep nipping at the monopolist's ankles will bring it down.
Unfortunatly, in the real world, there are barriers to entry, especially international ones and the world changes under us. And, of course, economic theories tend to assume agents in the market behave rationally, which we know is bollocks.
_O_
.|< The named which can be named is not the true named
It's a problem because it's an American company doing business in Japan. Japanese companies do it all the time in foreign countries. NEC especially carved a niche by matching competitive prices (in the form of discounts and rebates) against IBM among large businesses that had a large number of IBM PC's. Once a big company like AMOCO started buying NEC desktops, they moved on to printers, etc. The program where they would give a rebate or discount when a customer traded in a competitive PC was effective for a while in the late '90's.
Of course, this wouldn't happen in Japan. Japanese keiretsu have pretty well divided up the Japanese business market satifactorily. Trying to skate a Japanese business away from an established vendor is considered socially deplorable. It's done, but very subtly, so it doesn't look like the computer company is establishing inroads in the competitor's market. In the US, their "cooperation" would be considered "collusion" and "price fixing".
Wanna read a cool book? "The Asian Mind Game" by Chin-Ning Chu explains a lot about the roots of Asian competitiveness and difference in ethical guidelines vis a vis The US and other occidental cultures. It will change the way you view Asian politics and business.
This attack on Intel may not even be aimed at Intel as much as laying the groundwork for an attack on Apple (which is actually doing OK against Sony in Japan) or the introduction of a Fujitsu replacement for the Intel chips a couple of years from now.
"The mind works quicker than you think!"
Companies set their real prices based on the manufacturing cost of the product and the profit they must make on each to stay in business. Their sell price is NOT supposed to be based on whether the the buyer is also obtaining products from a competitor. Giving rebates or discounts based no that principle is similar to a bribe, and is illegal nearly everywhere [unless you are receiving the bribe ;) ].
A corporation breaks the law, is found liable, and is forced to pay damages. It complies, but it makes public statements that "we did no wrong". It is therefore claiming it is complying solely due to government blackmail, intimidation: "we're complying because otherwise we might get shut down, or maybe be put in a government cage". Justice is dismised as irrelevant. People have the right to criticized the government, to disagree with it. But where does a corporation's "right" to "free speech" end, and sedition, work to undermine the government and its authority, begin? Corporations already get to use the government judicial system, subsidized by taxpayers, to do much of their most difficult negotiation work. And usually settle before judgement, cheating the public of any benefit from a precedent in the settlement. Why do we allow them to use and abuse our expensive justice system - and work steadily to diminish it, in favor of a power vacuum into which corporate power can easily move?
--
make install -not war
Hmm. Maybe Slashot can run a contest to come up with something we can place in their name that is as annoying as the dollar sign in "Micro$oft". How about "Intel In$ide"? No, that is a slogan - er - $logan. Anyone else?
My beliefs do not require that you agree with them.
[Intel to cop]: "Oh no, we would never do that." Case closed.
This time some [brave?] Japanese company probably complained to MITI and produced documents that showed their discountwas dependant on %Intel, not just volume Intel.
Japanese law may permit the whistleblower to remain anonymous. US law probably wouldn't. I doubt even Dell could risk Intel's retaliation.
Has Intel has gone to the Dark Side? or is this an isolated bad-saleman case? It isn't certain, although Intel remains responsible for it's bad salesmen.
I can't believe that the US government is so cheap to buy, to be honest. Is that all?
J.
You're only jealous cos the little penguins are talking to me.
In the last election cycle, computer companies gave money at the rate of 53/47 to Democrats over Republicans. Does that indicate a new conspiracy on the left wing that we should be worried about? source
There are numerous sites that report Microsoft donations were even more lopsided: they gave at the rate of 58/42 to Democrates. Where's the big stink being made by the "right wing"?
What is Microsoft extorting from the Democrats, hmm? Why aren't you complaining about that as well?
All politicians accept money from many sources, and most industries/companies donate pretty evenly to the major parties. Your obvious statement that one party is obviously doing favors for a particular company because of those donations, while the other party that got almost exactly the same amount of money isn't doing them favors, is unsupported by any facts that you've presented.
How legal exactly is it that Microsoft would forbid PC makers to sell their machines with any other OS if they plan on selling some of them with Windows pre-installed? Yet, this is exactly what has been the case. Is it fair competition? I don't think so! "You can't use our products if you use any other product." Oh yeah, what a wonderfully ethical practice...
For the past 25 years, I have watched the Intel vs Competitor battle, in both memory products and CPU products. Intel products always cost more than their competitor's similar product. I am not convinced that AMD can build a product at a lower manufacturing cost than Intel, yet their product always has a lower cost. Now that AMD has equalled or surpassed Intel in processor design and is gaining market share, Intel seems to be following in the footsteps of Microsoft. As a design engineer,I stopped specifying Intel parts long ago when I realized that they were price-gouging their customers. They have a good part, and as long as people are willing to pay more for a label that says "Intel Inside" then that is fair. Paying a rebate or bribe to keep customers is illegal and considered unethical.
Intel is stupid for even proposing it. No such thing as "guarantee" in the business world.
This is just priceless:
U.S.-based AMD Not Seeking Orders From PC Seller Dell
Dow Jones Equity News, Thursday, March 10, 2005 at 00:17
TAIPEI (Dow Jones)--U.S.-based Advanced Micro Devices Inc. (AMD) has no plans to supply chips to Dell Inc. (DELL) in the foreseeable future, despite Dell's No.1 position in the global personal computer business."Our plans to successfully grow market share and improve our finances are actually based on not doing business with Dell. We're not going to give away product just to win Dell,"said Hector de J. Ruiz, chairman, president and chief executive of AMD, at a small media gathering in Taipei on Thursday.
The comments come shortly after Dell's chief executive, Kevin Rollins, said the U.S. personal computer giant wouldn't likely add AMD as a supplier of microprocessors, keeping its long Intel Corp. (INTC)-only policy in place.
AMD and Intel compete in the market for computer microprocessors, which act as the brains of a personal computer.
Ruiz also said his company's plans to introduce a new flash memory chip designed to store data in a range of mobile products like cellular phones, digital cameras and music players, will be in production next year.
He said customers will be able to sample the product, called ORNAND, in the second half of this year.
The chips will combine the speed of NOR flash memory, which takes its name from the algebraic expression"not or"and is used mainly in mobile phones, with the greater storage capacity of NAND, or"not and", flash memory chips.
NAND, a chip segment dominated by South Korea's Samsung Electronics Co. (005930.SE is favored in gadgets that require greater memory storage space, like the iPod Shuffle music player.
AMD's flash memory unit, Spansion, is a joint venture with Japan's Fujitsu Ltd. (6702.TO), and is developing the ORNAND chips.
(MORE) Dow Jones Newswires
03-10-05 0017ET
SOURCE Dow Jones Equity News
03/10/2005
Yes, Intel got caught but the 'penalty' for their crime seems to be that they promise to never, never do that again. The benefits that Intel has secured by locking up the big Japanese computer makers such as Sony, NEC, etc. as exclusive Intel-only shops seem to far exceed the 'cost' of the penalty. If you look at the overall computer market, most computer makers are now either Intel-only or nearly Intel-only which doesn't leave many crumbs for AMD to pick up. For example, if you want to buy an AMD-inside desktop machine in the US, you are pretty much limited to going either HP or building it yourself . Even with HP, the AMD-based models to choose from have low-end hardware and processors so if you want to get a powerful AMD machine, you have to get out your screwdriver and build a white box. The bottom line is that getting a monopoly is a very profitable business objective for Intel and they are doing a good job for their shareholders by pursuing it.
But how could Intel do such a thing ?
with Microsoft, you get the ridiculous situation of OEMs hiding their Linux offerings as well and also having "XXX recommend Microsoft XP Pro" messages on the same pages...
Donald 'Duck' Dunn: We had a band powerful enough to turn goat piss into gasoline.
Now, pure free market theory would say this is fine, evenetually Intel will run out of money and the 10th firm to be built on the ashes of AMD will win out.
Um, where did you learn that? In the absence of market regulation, but where there are still barriers to entry like investments, economics of scale or network effects (note: you only need one of the above), there are many markets that are natural monopolies. They also tend to make huge profits (though less than full monopoly profits, since you normally have to spend some money defending it to squish potential entrants.
Key examples of the above:
All basic utilities (investments and economics of scale), it is not profitable for anyone to lay a 2nd sewer network.
Network effects:
Typically stuff like compatibility. Look at Microsoft Office for a brilliant example. Linux only exists because they haven't acted according to free market rules, it'd not be rational.
Does "competition" happen in such markets? Oh yes. But it is all about displacing your opponent and take the monopoly for yourself. As the runner-up, you are losing money and there is no stable oligopoly. You either win or you exit.
Noone would try to displace someone with pockets bigger than your own. And they just keep getting bigger all the time. There's a reason why many natural monopolies have been regulated, and why there are anti-trust laws to ensure that you do not keep displacing your competitors by running them dry, one by one.
Kjella
Live today, because you never know what tomorrow brings
I can't say what the parent truly meant, just what it looked like to me.
At any rate you're right. Neither party is guilt free, we've seen it with all kinds of policians regardless of party. It is the reason we need to restrict funding, convincing our representatives of that is exceedingly more difficult. Definitely isn't right but as long as people keep electing someone like Bush it will continue; in the U.S. at least."The problem arises when somebody tries to use their position as the established leader to keep other companies from establishing a marketshare, thus using their dominance to maintain a monopoly."
Apple refuses to license their fairplay system, using their dominance in the music download business to leverage sales for iPods, the only player that can play these songs without jumping through a bunch of hoops.
Apple refuses to support WMA on iPods, combined with their refusal to license fairplay, allows them to use their mp3 player monopoly to leverage their iTMS online music sales. No one else can sell a song with DRM that plays on an iPod.
They're hoping the positive feedback of the lockin in these markets will keep them on top.
Vote for Pedro
I don't see why this is wrong. For similar example look at the fast food industry. If Del Taco agrees to carry only Coke products then Coke gives them the product at a discounted price. I think this practice is common. I don't see anything wrong with if Dell computers wanted to sign some sort of exclusive deal with Intel where by agreeing to use only Intel they get the product at a discounted price. How is this any different than the above?
I used to work for a motherboard manufacturer and they had similar policies here. We used to buy millions of chipsets from them. The MB business is very low profit margin, so a rise in the cost of components could kill you. If you were exclusive to Intel you'd be on their "MVP" list, but if you pissed them off you'd fall off that list. Being on that list ensured that you'd get your chipsets on time and for the best price. Without being on that list, they couldn't guarantee you the full supply you wanted, and the price would go up by a dollar or two.
They tried to hide it by saying that they had "shortages" and had to limit your supply, but the "shortage" always seemed to go hand in hand with you looking into buying other chipsets, or making boards for non-Intel processors.
They were very aggressive and commonly used strongarm tactics.
AMD can not make enough chips to supply Dell exclusively. AMD will never be able to afford the plants to make those chips without contracts from places like Dell.
But Dell can not buy 15% of its chips from AMD because Intel is threatening them. This puts AMD *and Dell* in an impossible chicken-and-egg situation.
You see, it's not all about rebates from Intel. Imagine if Intel can't get around to finding enough chips for Dell! I'm sure the threat is more along this line.
They gave their customers lower prices if they guaranteed not to buy their rival's chips. To my mind, that is unfair.
Well, maybe it's not very "nice". But I still don't understand what objective grounds can be given for making it illegal or considering it immoral. They're Intel's chips, they made them - why can't they charge whatever the hell they want, to whomever the hell they want? You don't have to buy them. If you don't like Intel's practices, let them know - by supporting the competition instead.
Downmodding is the refuge of the weak. Don't downmod, make a better argument!
"Intel continues to believe its business practices are both fair and lawful."
;-)
I thought they said "...air and awful."
Someone put a black hole in my pocket and now I'm broke.
Fair? Like in still using architecture from a calculator?
No sig for now.
you'll get modded up, but unlikely for someone that badmouths Apple here to find any favour with the mods, regardless of how lucid the point.
I remember sigs. Oh, a simpler time!
The problem is summarized previously, but in case you don't get it, here it is:
You buy 1 Intel for $10
I buy 1 Intel for $15. Why? Because I also bought an AMD.
If I bought 10 Intel for $10 and you got 1 Intel for $15, that's more understandable, and fair. THe issue is that Intel gives a discount _if_ you do not use a competitors chips, not based on volume.
There's nothing wrong with volume discounts or possibly even discounts to preferred customers (say those who pay on time or something).
This is pretty much the same as Microsoft in the bad ol' days saying "If you choose to bundle some other OS with your PC's, Windows will cost you more. Oh, and by the way, you pay for a Windows license even if you didn't ship that PC with Windows".
We know. I work at Transmeta. Our Japanese clients tell us this, they like our stuff, but when 90% of their products are Intel, and Intel will refuse to give you discounts if you touch another CPU, money talks, they can't afford to run alternative CPU's.
" In the last election cycle, computer companies gave money at the rate of 53/47 to Democrats"
That may well be the case. Now, if it's not too much trouble, go back and read my post. I wasn't talking about "computer companies", I was talking about Microsoft specifically, in response to a comment about Microsoft's OEM's. Were you not able to follow the thread or are you trying to change the subject?
"Does that indicate a new conspiracy on the left wing that we should be worried about?"
If you think that the emasculated American left has ANY power today, political or otherwise, let alone enough to have a "conspiracy", I have to wonder about you. Name one powerful leftist in American politics today. Not a useless blowhard like Ted Kennedy or Hillary Clinton, not an up-and-comer like Barack Obama - somebody who can actually get something progressive done instead of just blowing hot air and watching their polls. Just one. I dare you.
So let's see, 47% of voting America represented by exactly NONE of the federal government in anything short of a filibuster... hmm, almost like we're being taxed without being represented.
Gee, why does that sound familiar?
Oh, and by the way, the word "conspiracy" is yours and yours alone, my friend. Nobody was talking about a conspiracy. I was talking about extortion, which I suppose could qualify as a conspiracy if you're bored and pedantic enough to consider a blowjob an impeachable offense. And now that I think about it, even "extortion" is probably the wrong word. "Criminal solicitation of bribes" is more like it.
"There are numerous sites that report Microsoft donations were even more lopsided: they gave at the rate of 58/42 to Democrates. Where's the big stink being made by the "right wing"?"
I fart in "numerous"'s general direction. How about numerous and reputable? Cite 'em if you got 'em, cowboy. And the like of Little Green Footballs doesn't count, sorry.
"What is Microsoft extorting from the Democrats, hmm?"
Oh, are we back to talking about Microsoft? I thought it was "computer companies". Well, seeing as how the dem's got less than 50% of the amount MS donated to the NRCC for one dinner before they solicited (and again, my MS's own admission, probably received) the other million on top of it, and seeing as how it was a Democratic DoJ that went after them... Nothing, Einstein. Come on, your UID number is like one seventh of mine, you can do better than that..
"All politicians accept money from many sources, and most industries/companies donate pretty evenly to the major parties."
Again, the previous comments were about MS, not the industry.
"while the other party that got almost exactly the same amount of money isn't doing them favors"
Hmm. Let's review, shall we? First Microsoft gave 25 grand to the National Republican Congressional Committee to be a "table sponsor" for ONE DINNER. In 1997-8 MS - again, by their OWN admission - gave 2/3 of all their campaign contributions to the Republican side of the aisle. Then the GOP, who could have denied some of these donations in the name of avoiding even the appearance of impropriety (they're the "values" guys, right? That's what my TV keeps telling me), instead went back to Redmond and ASKED FOR ANOTHER MILLION - again, by their OWN admission.
"is unsupported by any facts that you've presented."
They're not my facts, they're Redmond's. Look, if you want to have the opinion that Microsoft gave evenly to both sides of the aisle, I can't stop you. You just have to realize that the only account of their giving you are trying to refute is MICROSOFT'S ALONE. This is what THEY said happened. This is how THEY said they spent their money. Believe it or don't - it's not me you're arguing with.
They will never stop until somebody makes the
Yep Every criminal in the pen is innocent, Standard Oil was justfied giving away gasoline in new markets and raising the price in old ones to offset the cost. Dalmer claimed that his victims "asked for it"
That's the problem with ego's. In the hands of those without morals and ethics they leave you thinking you are right because you appear to have succeeded. What Intel doesn't understand is, they have been found guilty in a court of law.
The other thing they don't understand is that it isn't a US court of law. It isn't even the US. They are a bunch of guylos (sp) who are not, despite what they may think, an inside player. As a damn American who has had the joy and frustration of living in asia for more than a decade I can attest that no matter how well you think you are in. No matter how many local faces you have, if the name on the card isn't a home grown mega company you are in second place flat out.
I'm sorry, I'm to tired to be witty at the moment so this message will have to do.
What I think you are not considering is that in, as far as I am aware, every country the notion of forming a company is a privilege. It is contingent on behaving in a way that is not detrimental to the consumer at large.
Otherwise, why would we even have audits?! What is objectively reasonable about forcing people to declare their accounts? Why not just make them declare their profits as that is the basis of tax (and what happens to ordinary mortals)?
I should point out I have the perspective of one who runs his own company, no matter how small. YMMV.
Justin.
You're only jealous cos the little penguins are talking to me.
Fight Frist Psoting!
Browse Slashdot with 'Newest First'!
What I think you are not considering is that in, as far as I am aware, every country the notion of forming a company is a privilege. It is contingent on behaving in a way that is not detrimental to the consumer at large.
I agree that forming a corporation is a privilege granted (rightly or wrongly) by government. But forming a company, i.e. a group of people who work together for a common goal (which could be making CPUs, or putting on a theatre presentation, or whatever) is (at least in the United States) constitutionally protected by the First Amendment ("free assembly"); i.e. it is a right, not a privilege. And what's to say that an unincorporated company might not choose to give rebates to its customers based on their decision to buy or not buy from its competitors? Would that be wrong, too?
Downmodding is the refuge of the weak. Don't downmod, make a better argument!
I think we have a difference in terminology only, here. In the UK, a company is afforded certain legal rights and privileges (limited liability, reduced tax) as it is intended to foster co-operative productivity and thus eventually employment. Perhaps that maps better to corporation?
Taking your second example to the extreme, would it be an issue if the dealer was an individual, offering lower prices if the customer doesn't buy from another individual? I don't know.
J.
You're only jealous cos the little penguins are talking to me.
I think we have a difference in terminology only, here. In the UK, a company is afforded certain legal rights and privileges (limited liability, reduced tax) as it is intended to foster co-operative productivity and thus eventually employment. Perhaps that maps better to corporation?
I think so. In the US, a company can be just any ol' business, whether legally incorporated or not. I don't think the term has legal significance. A corporation, however, is chartered by the government, afforded liability protection, a different tax structure, and legal "personhood" - i.e. a corporation can do things that normally can only be done by individuals, like engage in contracts, etc.
Downmodding is the refuge of the weak. Don't downmod, make a better argument!
Ah, that's exactly what we mean by a company - an incorporated legal entity with limited liability (just like bankrupcy protection for individuals).
J.
You're only jealous cos the little penguins are talking to me.