N.Y. AG Files Antitrust Lawsuit Against Intel 169
CWmike writes "New York Attorney General Andrew Cuomo has filed a federal antitrust lawsuit against microprocessor maker Intel, alleging that the company engaged in a 'systematic campaign' of illegal conduct to protect a monopoly. Cuomo's lawsuit alleges that Intel extracted exclusive agreements from large computer makers and threatened to punish those perceived to be working too closely with Intel competitors. Intel gave computer makers payments totaling billions of dollars in exchange for the exclusive agreements, and the company threatened to cut off payments to computer makers or fund their competitors when they worked with other microprocessor makers, the lawsuit alleged. Cuomo's lawsuit comes less than two weeks after news reports that the FTC is considering filing a formal complaint against Intel. 'Rather than compete fairly, Intel used bribery and coercion to maintain a stranglehold on the market,' Cuomo said in a statement. 'Intel's actions not only unfairly restricted potential competitors, but also hurt average consumers who were robbed of better products and lower prices. These illegal tactics must stop and competition must be restored to this vital marketplace.'"
Maybe Intel needs a new CEO and Board. (Score:3, Informative)
My understanding is that only one member of the Intel Board of Directors [intel.com] has any technical knowledge. How can people with no technical knowledge oversee an enormously high-tech company? They can't.
Intel board member John L. Thornton was president and CEO of Goldman Sachs Group, it says. Goldman Sachs [rollingstone.com] helped engineer the present financial collapse. Since the collapse, Goldman Sachs has been very profitable. The U.S. government has done NOTHING to prevent further abuse.
Re:Maybe Intel needs a new CEO and Board. (Score:4, Informative)
I think you misunderstand the purpose of a Board of Directors. Their job is not to oversee the company, that is management's job. Their job is to look out for the interests of the stockholder.
Re:It's the new fad (Score:3, Informative)
While I wouldn't say the Microsoft anti-trust suit was nearly as successful as many of us Slashdot types would've hoped, it did have some benefits. It managed to stop a few pernicious practices, like exclusive licensing to OEMs (who weren't allowed to sell non-Windows OSs if they wanted to receive the normal favorable OEM pricing). It also provided a sort of hovering threat that forced Microsoft to at least think a little harder about whether they wanted to engage in new anti-competitive practices, since MS knew the cost of doing so would be higher than otherwise.
The result was very well known in advance. (Score:3, Informative)
Everyone in the financial industry knew two things: 1) The bubble would collapse, and 2) The U.S. government, led by the Federal Reserve Bank, composed of former financial industry executives, would make the taxpayers give money to the financial institutions.
You didn't read the Rolling Stone article linked in the grandparent comment, did you? Or anything else about Goldman Sachs and the financial collapse?
Note that the "Federal Reserve Bank" is not a bank, it is not federal, and there is nothing in reserve. Three lies in three words, in the name!
This Slashdot comment, The Investment Banking cohorts JPMorgan Chase and Goldman Sachs are the **huge** winners [slashdot.org], discusses some of the new ways Goldman Sachs will make money in the future using the power of government. That Slashdot comment links to the Rolling Stone article, but that copy of the article has been removed. See the link to the article in the grandparent comment.
The corruption is not new. For example, see the May 13, 2002 article in Business Week, How Corrupt Is Wall Street? New revelations have investors baying for blood, and the scandal is widening [businessweek.com] Quote: "Consider Enron, which has paid $323 million to Wall Street in underwriting fees since 1986, according to Thomson. Goldman, Sachs & Co. (GS ) pocketed $69 million of that..." Enron, of course, went bankrupt when it was discovered the company was dishonest.
Beginning in 2002, Warren Buffett began very publicly calling derivatives "financial weapons of mass destruction" [bbc.co.uk]. That particular part of the corruption was allowed by the removal of laws designed to prevent fraud, at the beginning of George W. Bush's first term. Nothing was done to reinstate the laws, and that's why we are suffering now. Why was nothing done? Numerous articles say the corruption was allowed to happen because Goldman Sachs people, and other financial company executives control the U.S. Federal Reserve Bank.
If the past is any guide, Intel will be fined a trivial sum like $100 million, and the corruption and anti-competitive activity against AMD will continue.
Part of loving the U.S. is becoming aware of, and trying to stop, the corruption in government.
Breaking the law is okay with you? (Score:3, Informative)
Re:Delaware? (Score:4, Informative)
Because Intel (like most other large corps, I think) is incorporated in Delaware.
Re:Govt Seizure of Private Business (Score:4, Informative)
And the alternatives to government-authorized and strictly-regulated monopolies in a market with natural monopoly tendencies are...
1. No service provider
2. Unregulated monopolies.
Maybe you weren't around when telephone and/or cable infrastructure was being built out. The choice was: license a monopoly, or get no service.
Even now, these markets tend to natural monopolies due to high overhead and infrastructure costs. So if we deregulate, we'll still end up with a monopoly... but it'll be less regulated one. Yay.
Re:Govt Seizure of Private Business (Score:1, Informative)
Re:I'll scratch your back.... (Score:4, Informative)
I'll agree with you on the shady practices of Intel when the Athlon line was launched - but I don't think a one hit wonder like that should magically position AMD as the top chip maker.
Nobody said they should have been the top chip maker -- that would have been impossible simply based on AMD's manufacturing capacity relative to Intel's. They should have gotten a lot more marketshare than they did, though, and that difference would have been huge for AMD. Companies like Dell and HP wanted to sell (more) AMD processors based on their merits, but the financial punishment that would come from Intel made it not worth it. That's a big deal.
Brand recognition is one reason. Reluctance of professionals trusting AMD processors in server grade machines could be another. The P4 may have sucked but keep in mind that previously AMDs chips sucked as well, and for a long time the only thing AMD was good for was reverse engineering Intel designs
Yes but those days were also long gone. AMD earned recognition as a chip designer in their own right with K6 as a budget processor, earned recognition as a chip maker capable of going toe-to-toe with Intel with the K7, and then knocked it out of the park with K8. The true customers of Intel and AMD, the OEMs, were well aware of AMD's "brand" and had no qualms about using them in server parts... Except for the interference by Intel. Did you see the email from Dell to Intel where they're basically telling intel that they're getting killed in the server market and Intel better do something? And intel's response is that the $billion they'd given Dell should compensate for their competitive disadvantage? Customers wanted to use AMD, but Intel made sure that AMDs marketshare was artificially limited.