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FTC Opens Formal Antitrust Investigation of Intel
andy1307 writes to tell us that according to the New York Times, The Federal Trade Commission has opened a formal antitrust investigation of Intel. Reversing the decision of former FTC chairperson Deborah P. Majoras, the new chair William E. Kovacic is pushing the investigation to look into Intel's pricing policies. "Since it will almost certainly be many months before the commission decides whether to make a case against Intel, as European and Asian regulators have already done, the investigation could mark an important early test for the next administration on antitrust and competition policy."
Intel has been using their size, money and influence to keep competitors out of use in their customer's systems. This is anti competitive, and when on a scale of this size, is considered monopolistic. Intel owns over 80% of the microprocessor market, plus they design specs for systems, such as their PCI spec.
If Intel is guilty of keeping other processors out of machines by being anti competitive, they are going to see some sanctions and fines.
You don't have to have a monopoly to comit illegal business practices. Conversely, you can have a legal monopoly that doesn't violate antitrust laws.
Intel violated the concept of competition by threatening companies unless they only carried Intel products. They threatened to hold off shipments of paid products, etc. etc.
They've already been found guilty of antitrust in other countries. AMD claimed to have a mountain of evidence, and several companies willing to testify. I'm shocked it has taken this long to even really open the case in the US. The sad thing is that it almost worked out for Intel, that by breaking the law, they almost drove AMD out of business. At that point, a fine doesn't matter because they would have total market share.
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Yeah. They would be shown some new backdoors and have their interfaces expanded to accept all sorts of new peripherals.
Intel was a single source supplier for CPUs. IBM wanted a second source or they would not deal with Intel. Intel then sourced production of pre 486 CPUs to AMD. However, they did not restrict AMD from selling them as their own, which they did. Then, AMD was developing their own chips based on the instruction set and specification that intel developed. Intel sued for trademark infringement, knowing that AMD had the license to produce likewise chips. The courts in the US ruled that Intel could not trademark a number, which is why there was no 586, but rather the "Pentium" with the 5 prefix Pent. This is a trade-markable name.
Being more agile than Intel, and being willing to accept thinner margins than Intel, AMD and competitors were pricing very attractively to OEMs. Intel, however, looked disfavorably on this. They punished their customers with "shortages" of their chips and chipsets, knowing it would allow their customer's competitors, also their customers, to gain an upper hand. They also offered special pricing, not for volume, but for "loyalty." They would give their customers a break if they were 100% intel customers and not "Buy 10,000 units and get 200 free, which would likely have been legal.
The issue is not substandardness nor the inability to compete. Instead, it was that after the original Athlon, AMD was able to out maneuver the challenges that intel through in its way and was able to out innovate them in many areas. The FSB that intel still uses can cause memory bottlenecks as well as poor scaling to multiple sockets and cores, but that is a topic for another discussion. Intel was abusing their customers, their competitors, and consumers with their methods of market manipulation. But, to quell your intent to show that AMD et al were simply riding on Intel's coat tails, ask yourself "Who built the spec to extend x86 to 64bits with extended register counts?"
I think you need a history lesson. When AMD released the original Opteron in late 2003/early 2004, it had numerous desirable, innovative features that Intel's offerings at the time did not have:
AMD has alleged that Intel used its monopoly position to exclude Opteron and other K8 derivatives (Athlon64) from major OEMs for 2 years, from its release in late 03 until sometime in 2005, when the antitrust allegations were filed. During that time, the problem was not poorer, "cloned" products which offered no advantages over Intel's. Basically, anyone who followed the x86 processor market during that time knew that Opteron/Athlon64 was better than P4, for a competitive price.