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EU Regulator Raids Intel Offices

Posted by Zonk on from the bad-day-to-be-a-drone dept.

stevedcc writes "BBC news is reporting that Intel's offices in Munich, Germany have been raided by European Union competition regulators. From the article: 'The Reuters news agency reported that the Commission also raided computer retailers on Tuesday including Germany's Media Markt, which sells PCs with Intel central processing units but not those made by AMD. Regulators have the power to fine Intel up to 10% of annual turnover if they find it guilty of stifling competition. Intel has said it is "confident" it had acted lawfully.'"

3 of 138 comments (clear)

  1. Re:Gone Too Far by Silver+Sloth · · Score: 5, Insightful
    How it works:-
    1. Dominant player in market cuts costs to below cost of manufacure
    2. Secondary player has to cut costs to match
    3. Secondary player has shallower pockets than dominant player and goes out of business
    4. Dominant player is now only player and can raise costs as high as they want to make back all they lost in action #1
    There are reasons for market regulators, and not just because we European liberals like big government.
    --
    init 11 - for when you need that edge.
  2. Re:Printers? by dasbush · · Score: 5, Interesting

    Everyone knows printers get sold for nothing and all the money is made on the ink and paper. You don't here about raids for selling printers below cost Since it is generally accepted by all printer manufacturers that there is no money in printer, but rather in the ink, all the companies are doing it. In fact, since there are more than two companies doing this practice and surviving (even thriving) then it clearly is not a monopoly. If there were only two printer companies in the world, and the much larger one started selling ink for nothing, then the analogy would be comparable.

    That said, you raise an interesting point about where Intel/AMD make their money. Is it in the CPU or the Mobo's/Video Cards/etc that are optimized to work with the CPU?
  3. Re:Gone Too Far by matria · · Score: 5, Interesting

    This happens in other markets as well. Some years ago my husband worked for Pfizer. Pfizer and most of the other big pharmaceuticals made penicillin. It wasn't exactly a large profit item, but a good seller. Then a European company started "dumping" and nobody else was willing to match their prices. So all the other pharmas quit making penicillin; most of them re-tooled their penicillin facilities to other products. Pfizer also quit making penicillin, but their equipment was so old they just left it sit. The European company misjudged and ended up going out of business. Suddenly there was no supply of penicillin. So for a couple of years, until some other companies got their penicillin facilities retooled back to making penicillin, Pfizer had the only world supply of penicillin,and could pretty much charge whatever they wanted.

    So this sort of behavior is definitely not a good thing. Except for Pfizer there for a while, anyway.