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AMD Files Antitrust Lawsuit Against Intel
jonathan_ingram writes "As reported on GrokLaw, AMD has just filed an antitrust lawsuit against Intel. AMD states in its press release that the complaint details "... how Intel has unlawfully maintained its monopoly in the x86 microprocessor market by engaging in worldwide coercion of customers from dealing with AMD. It identifies 38 companies that have been victims of coercion by Intel - including large scale computer-makers, small system-builders, wholesale distributors, and retailers, through seven types of illegality across three continents.""
Full text of the complaint filed can be found here in PDF format.
Interesting read...it's high time we saw some legal action against Intel for all these shenanigans. However, I'm doubtful that this will resolve anything...in reality, Intel will probably be about as inconvinenced by this antitrust action as Microsoft was by theirs.
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~ |rip/\/\aster /\/\onkey
As some of the articles on this topic state, the money AMD might get for damages isn't that important. They just need to get their products in the hands of resellers.
They need to drum up more exposure, what better way that an anti-trust case? I'm not saying they don't have one, I am sure they are privy to info I am not, but isn't it great AMD advertising?
Intel, while you can cherry-pick instances of supply problems, has proven itself to be a stable and consistent supplier.
We always seem to quickly forget their bad processors that seem to quitely fade away into non-existance.
We also seem to ignore their attempts at privacy invasion...
I wonder if situations like this will ever come about in future, where global patents will ENSURE monopolistic practice, legitimised through legislation. No appeals or crying foul against the sort of practices Intel and Microsoft appear to favor, only the patent holder gets protection. Consider a 1980's where Intel had patented-down the hatches on the x86 architecture - there'd be no AMD, there'd by not Cyrix, Winchip, Transmeta, VIA etc....at least not making the same architecture. Maybe this would have been a good thing, the x86 bastard-child architecture we've all ended up with is nothing to be proud of. It's not too late for CPU diversity, come on AMD time to make something new!
Only three remote holes in the default install, in more than 10 years! OpenBSD
Why do I have the feeling you weren't an AMD customer before?
You might want to read the complaint before you come to such an abrupt, erroneous decision.
Unless, of course, you're just astroturfing.
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~ |rip/\/\aster /\/\onkey
You should study business practises a little more carefully. Intel has had a history of being just as predatory as Microsoft on and off through the years. Dell, Gateway, and Micron all have complained over the years that they wanted to sell other chips, but were threatened support/pricing from Intel if they did.
A monopoly doesn't mean that a company has 100% of the market, it just means that they have an overwhelming majority such that they can exert pressures against smaller companies by threatening customers. This is not the same as Intel underpricing AMD because they have a better capacity than AMD. That is legitimate business, and a gain from having the kind of production capacity that Intel has (an economy of scale). The allegation here is that Intel is witholding incetives only for people who specifically buy AMD products, meaning that Intel is using its position in the market to limit competition by not only providing incentives to use Intel products, but to provided disincentives to use AMD products. That seems like a pretty shady deal to me. Doesn't that strike you as disgusting and abhorrent?
I'd rather be cycling.
Shouldn't you be doing something useful?
No idea how that got moded Interesting, much more like troll.
Intel doesn't have a monopoly
First is the obvious point that this is irrelevant! Anti-trust laws have no requirement you have to be a monopoly to be guilty of anti-trust behaviour! Anti-trust is about trade practices that undermine competitiveness or are considered to be unfair. Intel is certainly guilty of this.
Second is if its OK for Intel to use anti-competitive behaviour why not MS? Neither have 100% market share. What percent market share does it start being wrong to use anti-competitive tactics in your mind?
I'm glad MS got busted for these EXACT SAME anti-trust practices (prefered pricing for only using their product) and I hope Intel will as well.
"reality has a well-known liberal bias" - Steven Colbert
You mistake something. AMD can count it's sales per chip to whomever, OEM or home builder, just like Intel can. It doesn't matter to whom the chips go. When you talk about 'per unit' sales, for Intel and AMD, they're talking about 'processors' as the unit, not OEM PCs.
It makes me sad to say this, but we really do need some kind of law against "rebates" and, what does Microsoft call it, "matching marketing funds"? These companies can not play fairly, and these accounting tricks need to be outlawed because that is all they are - accounting tricks to obscure bribes. Maybe something along the lines of outlawing these shady accounting practices for all publicly traded companies.
I have come to a conclusion that one useless man is a shame, two is a law firm, and three or more is a congress -J Adams
This does sound pretty damning, but I still want to hear Intel's side of this story. Personally, I've always preferred AMD chips over Intel chips, and I think that if AMD is successful here, it will do great things for that company. I will, however, take these claims with a grain of salt. Many people identify with AMD as the underdog with an undersung product (I sure do), and are often quick to side with them. Intel may have legitimate reasons behind all of their business practices, and since these comments and 'facts' have come through what I like to call "the AMD filter," I would like to see the story through "the Intel filter" as well. Perhaps then we will be able to see glimmers of the truth, and be able to decide fairly if Intel really did overstep their bounds. I know who I'm rooting for, but it doesn't make it any less important to gather the facts.
I'd rather be cycling.
"Your going to use AMD? We'll give you our stuff cheaper."
"You're going to use AMD for some of your products? We're doubling the price of our chips you need for your other products, unless you reconsider.
That's extortionate, anti-competative, and illegal.
That is called BUSINESS, not CONSPIRACY. Sheesh.
So is "Papa is displeased. It's nothing personal" followed by a gunshot. The fact that it is business doesn't make it moral, ethical, or legal. In Intel's case, if AMD's assertions are shown to be true, their actions were immoral, unethical, and illegal. No one may care about the first two (which explains a great deal about the state of our society and our world, but I digress), but courts still uphold the law, by and large, most of the time, so people do care a whole hell of a lot about the latter.
The Future of Human Evolution: Autonomy
The article mentions Intel withholding rebate checks.
Is there anyone who feels rebates are legit anyway? The things should be outlawed for a number of reasons.
* Interest - money bears interest, delays in recieving it means the manufacturer keeps the potential interest.
* Honoring - Many companies 'lose' 30-50% of rebates submitted.
* Tax evasion - Companies claim loses on unsold and destroyed merchandise at the before rebate price. Since rebates only allow companies to bring the price to what is competative in the market this means unfair greater values claimed at tax time.
If Apple was pushed, now doesnt it?
2 ,39160769,00.htm, from last year rings true. Itanium procs dont compete. So if AMD has a better product, why shouldnt it attemp to push antitrust. Even if companies are undercutting Intel by guilting them into selling for cheaper prices , its still a form of monopoly. Likely they encourage it.
Whats really sad about most of all of this is that AMD's product out performs a large portion of Intel's products.
Yet companies like HP and Dell hold on to Intel like it was a mewling babe in need of a mothers teet.
This story , http://www.zdnet.com.au/news/hardware/0,200006170
Im reminded of Ballmer offering the germans a 90% discount on good/services if they didnt take a FOSS solution earlier this year.
Monopolies suck.
"God of Rock, thank you for this chance to kick ass. "
Don't be an idiot. The courts only establish whether it is to be legally held as true, not whether it is really true. Ask OJ Simpson about this.
We can still argue about whether what Intel is doing is legal or not. The argument that they are not breaking laws because the legal authority has not yet spoken is a silly one.
I have seen the future, and it is inconvenient.
So you've chosen the company who extorts its marketshare higher, instead.
Nice.
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~ |rip/\/\aster /\/\onkey
You want Intel software to support AMD?
Why should they do that? Intel develops this software for their processors as an added value for buying their processors. Nobody is preventing AMD from doing the same.
Matching advertising dollars in combination with cheap processor pricing is what keeps Dell in Intel's camp. Those little Intel jingles you hear at the end of every Dell ad on TV tell you that Intel fronted a LOT of the cash to put that ad on the air.
Since Dell is the only exclusiive Intel PC manufacturer, you can bet that Intel is cutting quite a few deals with them. Every once in a while, Dell makes noises about using AMD, and then they shut up. Apparently they are phishing for more $$ from Intel. I wonder if Intel's deal with Apple is a subtle warning to Dell.
"...Well, there's egg and bacon; egg sausage and bacon; egg and spam; egg bacon and spam; egg bacon sausage and spam..."
"Why would they introduce another chip line into low end machines, when their customer base is 90% clueless about computers?"
Are you really that stupid? Assuming that 90% really are clueless (even though it probably isn't), then we can safely assume (notice I said safely and not soundly) that those in the 90% do not care about what chip lines are used. Dell could then switch to AMD and chop maybe $25 off and have a cheaper machine. It wouldn't matter to the end user because everything would still 'just work' but would not be cheaper. Hell, since their machines are already damn cheap they wouldn't even have to lower their prices and they can just pocket the saved money.
Of course, since Intel gives them a nice rebate, Dell probably gets the best deal with Intel right now. If the result of this lawsuit either makes Intel not give out any rebates or give them out regardless of whether Dell starts selling AMDs, then it may actually be profitable for Dell to use AMD in lower end machines to save a few bucks.
* This is just speculation and guesses but the point is that a transparent switch to AMD might save Dell a few bucks with that "90% [customer base] clueless about computer".
Well, I don't hold a grudge against 'em. I prefer Athlon 64's to P4's, but upto the the P4 Intel seemed to make chips that were a bit faster, if a little expensive. And I would have bought an Itanium if it had decent performance, just because it seemed like an interesting bit of engineering.
If the the next generation of chips are any good, I'll buy one. It's certainly enouraging that they are making x64 chips now, even though Amd invented it. And moving towards shorter pipelines. I think they still have strengths compared to Amd, even if they are bit behind in fps per buck- their chipsets tend to be more polished than the Athlon ones from Via/Nvidia etc.
You mean like the unique ID? Net cards have always had had a unique ID, and hence so do most PC's. Anyhow, like AMD they're a company - they just make what sells. I won't buy there stuff it violated my privacy, but I certainly wouldn't hold it against them if they produced something better in the future.
They're not evil, just amoral and greedy.
echo -e 'global _start\n _start:\n mov eax, 2\n int 80h\n jmp _start' > a.asm; nasm a.asm -f elf; ld a.o -o a;
I am convinced more than ever that deals are being worked on right now between Sun and Dell.
The stock market apparently thinks this is just posturing by AMD. I'm inclined to agree.
AMD has never had the business acumen necessary to take advantage of the opportunities it has had access to. Its 30 years of flat stock performance make it almost look like a scam; a shell company designed to sucker investors to pump the price occasionally and pay off the principals who know they won't be reinvesting that value.
But you know the engineers there don't want it that way. Why they haven't revolted and thrown out the (mis)management is a mystery.
Maybe they should.
Meanwhile, Intel does nothing but produce its product. Usually it's superior. For 2000-2004, it wasn't. AMD failed to capitalize on that opportunity, and are now crying that simple competition is unfair.
If I were an AMD shareholder, I wouldn't be cheering this suit; I'd be embarassed to show my portfolio to anyone.
It makes me sad to say this, but in the current political climate within the US, I don't think that any of this (what you're asking for) is going to happen.
Much of the late-90's dotcom boom was predicated on the 1996 PSLR Act. This act was Clinton's ONLY Veto, over a Republican Congress, and they overrode him on it. This law opened the floodgates for corporate accounting fraud and corruption on an unprecedented scale, and only a very few of the criminals were ever caught or punished, including Enron, Worldcom, Citibank, Krispy Kreme, Arthur Anderson, Veritas, AOL, etc. etc. ad nauseum. The ones who were punished were given very minor slaps on the wrist, as a token gesture during a very brief era of symbolic regulatory tightening that began in late 2001, and ended recently with the appointment of Cox as SEC head.
Cox was the criminal bastard who WROTE the PSLR Act. So the brief era of symbolic regulatory tightening on oversight of corporate accounting practices has ended. It is now open season on shareholders, and especially consumers. I predict that this AMD action will go about as far as Netscapes complaint against Microsoft. A long, drawn out, and profitably-entertaining courtroom drama, AMD will falter and die, somewhere along the way, and in the end, a slap on the wrist for Intel.
Some of the folks who support this kind of wild-west business climate simply have a loyalty to their rich crony-capitalist buddies. Others have a more nationalistic ideology (They're an American company, we have to protect them so they can compete internationally - look what's happened to Boeing, they're effectively a jumbo-jet monopoly, but they're getting their asses handed to them by Airbus). In the end, companies like Intel, or Boeing, end up with no competition - and of course, it makes them still weaker. You think the Chrysler bail-out by the government had nothing to do with their eventual buy-out by Daimler? Corporate Welfare, whether by direct bailout, deregulation, or preferential treatment, or even special tax breaks, breeds nothing but dependent Corporate Welfare Queens. ONLY competition, in a fair, intelligently regulated marketplace, will breed excellence.
These are my friends, See how they glisten. See this one shine, how he smiles in the light.
'Rebates' could easily be turned into a lower purchase price. If the manufacturer is able to offer them after sale they could offer before sale instead.
Wal Mart so far only demand a lower price or won't buy your product. And their only tactic is basically lower their price. These are not illegal.
However, according to this law:
17045. The secret payment or allowance of rebates, refunds, commissions, or unearned discounts, whether in the form of money or otherwise, or secretly extending to certain purchasers special services or privileges not extended to all purchasers purchasing upon like terms and conditions, to the injury of a competitor and where such payment or allowance tends to destroy competition, is unlawful.
What intel is accused of doing, as in paying under the table or threaten to do anything if someone buy/sell AMD product. It is illegal.
AMD's complaints all boil down to "AMD can't afford to sell processors as cheap as Intel can, once all discounts and rebates are figured in." If you read between the lines, AMD tries to offer the same sorts of deals as Intel - but can't really afford it, so in most instances Intel wins. This also shows up in AMD's bottom line, where they used to consistently lose money, and still do sometimes, despite Intel's numerous mis-steps of late.
AMD's basic problem is that they basically wish they could become Intel, and think the way to do that is to mimic Intel's sales strategies - which they can never do as well as Intel because they don't have the manufacturing volume and low costs to back it up. "Business 101" could tell them how to compete in this situation, but their leadership's ego(s) keep them from doing it consistently.
Well, Intel WOULD be preventing AMD from competing if they say, hijacked their trucks, or threatened AMD employees directly. As it is, they're convincing vendors NOT to carry AMD products. And, they apparently offer products that offer a lot of value to the vendors, so vendors are choosing to no carry AMD products apparently (I've seen no sign of this from my end as a consumer... I can get AMD stuff anywhere). I have vendors every day trying to convince me to carry their product instead of somebody else's. Intel simply has a lot to offer, so they get to use that weight accordingly. That's what happens when you're successful. I take choice away from customers, too, whenever I decide not to carry a product because I don't like, say, the terms, the pricing, or even the sales person. Does that make ME a bad person? No. I'm yet another vendor that chooses to carry or not to carry various products based on all sorts of criteria. Some of those criteria are financial, some aren't. I fail to see the difference.
I don't respond to AC's.
(I've seen no sign of this from my end as a consumer... I can get AMD stuff anywhere).
Yeah, you can get it anywhere, EXCEPT from the biggest vendor of PCs in the world: DELL. So while joe-schmoe, I want to buy a Dell computer cause it's simple to do, browses around the DELL website, he's not being offered the option of having an AMD processor is his box.
The real question is: Would Dell sell AMD boxes if they were not at risk of being charged more by Intel? Considering the amount of volume they do, the cost of changing their assembly lines to have processor/motherboard swaps is negligable. It would probably make them more money in the end because they could sell cheaper computers and thus more volume.
To continue the beauty pageant analogy. Intel isn't locking out AMD by pouring acid on AMD's body or flattening AMD's tires. Intel is boning the judges and the contest administrators to prevent AMD from entering the door.
If Intel's product is truly of value and has intrinsic worth then Intel would not need to prevent its competitors from displaying their wares. The prize bull at the country fair doesn't get to be the prize bull by having no competition. You need your crappy competitors present so that your benefits can be highlighted to the consumer. The problem is, AMD isn't crappy. Right now, AMD is the prize bull. It's Intel that is worried about appearing crappy next to AMD.
Whether you flatten your opponents tires or you prevent them from even entering the market place doesn't matter. You've prevented the consumer from having a real choice in the matter. That is what is unfair about the situation. The people buying Dell computers don't have an option to put AMD in their boxes. I think Dell would sell AMD computers if Intel wouldn't change their pricing scheme.
I decide not to carry a product because I don't like, say, the terms, the pricing, or even the sales person. Does that make ME a bad person? No.
You're right here. But this isn't the situation we're talking about. If Dell doesn't like the terms with AMD, then they can choose not to sell AMD. However the terms with AMD are being influenced by Intel and thus it's not a pure relationship between Dell and AMD. This is the whole point. Intel is influencing business transactions between other companies. Philosophically, I think the transaction should go through or not go through based on the merits of the transaction by itself, not based on whether this transaction will cause other transactions to become more expensive.
Intel clearly does not want the general consumer to have easy access to a choice in processors.
I see a number of posters stating simply that "AMD is complaining becuase stores/companies went with the better chip manufacturer." This...is bullcrap. Intel is not better than AMD, and AMD is not better than Intel. The tides of chip superiority change constantly, often with little differences. This is the same as complaining about NVIDIA being better than ATI, or vise-versa. It's fruitless and moronic conjecture. What is superior today, could very well be inferior tomorrow. This happens all the time.
As for the lawsuit, from what I've read so far, AMD has a point. It's a boat with some leaks, but it's afloat. Let them bash it out. We all know who will win (whoever sticks their hands in the pockets of those in power). This, as usual, is big-money politics in the legal system. The outcome of this will have little to do with the actual facts.
"Now add the cost for a decent quality (e.g. Asus, Intel, Gigabyte, Tyan) motherboard (and basic VGA card if one isn't included onboard) and RAM. The last time I did this (for Xeon vs. Opteron) the Opteron system turned out to be more expensive."
Well, first of all, Opteron is not Athlon 64. There are lots of affordable, high-quality Athlon 64 motherboards (my personal favorite is an MSI board with the Radeon Xpress 200 chipset - $89, and it has decent onboard graphics).
And second of all, if you're running Xeon, you probably want lots of memory. And if you want lots of memory, you'll soon learn that large DDR2 modules required by Intel's platform are considerably more expensive than large DDR modules.
This is in fact exactly the opposite of what I am saying. I stated above that there cases when the customers' choices are limited, such as when Wal-Mart comes in and drives down prices, that are beneficial to the customer. But in the case of AMD and Intel, it is a very different situation. Instead of Intel gaining market share by having a better product, it is using its position in the market to muscle AMD out. It is not doing this with a better product, but rather by threatening the middle man who stands between Intel and the consumer. That is the allegation, and that is what is illegal. In no way is the government punishing Intel for being successful. If Intel receives punishment, it will be for using its success to create an unfair marketplace.
This is a case of the government punishing Intel for being too successful, and handing money/customers/business to AMD because they are less efficient/cannot compete
I'm not saying AMD deserves handouts any more than I'm saying Intel deserves to be punished. In fact, AMD won't get any 'handouts' regardless of the outcome of this case. In fact, Intel is perfectly welcome to give price breaks for people who buy a lot of Intel products. Intel is perfectly welcome to underprice AMD. What Intel cannot do is give specific price breaks to people who do not sell AMD products. Don't you see the difference? It's when Intel mandates what the vendors do regarding Intel's competitors' products that they cross into illegal territory, and that is when the consumer loses.
This has nothing to do with the US Government taking pity on smaller companies and just taking property from Intel. I have no idea where you got that idea. This is about whether or not Intel is manipulating the market by changing their prices for different people based on whether or not those people do business with AMD.
I am in no way saying that the US Government is going to help companies out with financial handouts. Where are these handout ideas coming from? This is antitrust litigation, not grants. And what do AMDs CEOs have to do with this? We're talking about whether or not Intel is illegally influencing the market. AMD might be doing poorly because of their CEOs, but that has nothing to do with this debate, because we're talking about whether or not Intel is doing something illegal.
Intel is absolutely a monopolistic company. They don't have a total monopoly, but they have enough market share that they can influence the market in these ways. This isn't like econ class where someone either is or isn't a monopoly. It's not like Intel is just moving across the street from AMD. Intel is perfectly welcome to compete in AMDs markets. The issues is if Intel tells its vendors they can either receive price breaks or they can sell AMD products. I think you are still thinking of this too much as a retail thing. Take Petsmart for example. Petsmart moving next to Petco is fine. What would be unfair is if Iams told both companies that they would receive a 10% rebate as long as they didn't sell Kibbles and Bits. Doesn't that seem shady? It has no effect on the consumer except to say that they will no longer have the option of buying Kibbles and Bits.
How will it hurt the consumers? I would argue that allowing AMD into the market at Dell would create more performance pressure for both companies. What is stopping Intel from producing poorer quality chips for Dell right now, since they have no other competition? It has been shown in many benchmarks that AMD is just as strong if not stronger in performance, but they still don't appear in Dells.
I see this as lose-lose the way things exist right now. If Intel weren't creating this pressure, and there will still no AMD chips in Dells, then I would absolutely agree that AMD is an inferior product.
I'd rather be cycling.
The company who's CEO testified on Microsoft's side in the Windows anti-trust hearings is crying about Intel's unfair practices and I'm supposed to be how sympathetic?
Having said that, I don't think I've used an Intel chip in a PC that I've specced for about 4 years but I find it hard to shed any tears.
Hmmmmmm..... Deep fried and look like Squirrel.