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Intel Government The Courts News

Intel in Antitrust Trouble in Japan 203

Posted by samzenpus from the big-and-illegal dept.
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."
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Intel in Antitrust Trouble in Japan More

Intel in Antitrust Trouble in Japan

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  • So carrots are legal, sticks are not (Score:5, Interesting)

    by grandmofftarkin ( 49366 ) * <3b16-ihd3@xemaps.com> on Thursday March 10, 2005 @06:01AM (#11898103)
    In summary it looks like there is no problem encouraging people to use your product, it is only wrong if you threaten them when they consider using another companies product. Yes, this sounds pretty reasonable to me.

    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.

    • Re:So carrots are legal, sticks are not (Score:5, Insightful)

      by Anonymous Coward on Thursday March 10, 2005 @06:15AM (#11898134)
      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?

      Statements like this are not meant to be factual. They are meant to influence opinions. "continues to believe" is a phrase that should warn you that a politician or a company is lying to you. Always replace it with "persists in claiming".
    • it is only wrong if you threaten them when they consider using another companies product

      Of course, Intel did not actually threaten to initiate force against their customers (theft, fraud, extortion, murder, rape, etc). If they had, there would be no debate over the ruling. Intel only "threatened" to stop engaging in voluntary trade with their customers! Can you not see the difference here? Or were you deliberately trying to present the case as an actual threat of force?

      The fact is that Intel's customers

      • Re:So carrots are legal, sticks are not (Score:4, Insightful)

        by jackb_guppy ( 204733 ) on Thursday March 10, 2005 @07:09AM (#11898277)
        You are using Voluntary very loosely.

        Intel when up from 78% to 89% of the market.

        Now the bases is same as Microsoft did to PC here in the US; "If you sell the others products, we will NOT give you money".

        What is large market share in your business, if you sell another's products, you loose money that makes you profitable.

        That is MOB (as in the market) talking.

      • Re:So carrots are legal, sticks are not (Score:4, Insightful)

        by Qzukk ( 229616 ) on Thursday March 10, 2005 @08:35AM (#11898320) Journal
        I can and have "threatened" to quit doing business with online stores who tried to sell me damaged computer parts. Should I be charged with antitrust violations? Why or why not?

        Of course not, A) damaged goods are not an acceptable good and B) You're the buyer, you can do what you want anyway.

        Now lets say you go to the computer store and the manager says "You own an AMD, so that video card in your hand will cost double" would you call that a fair trade practice? If they're the only computer store in the country?

      • Re:So carrots are legal, sticks are not (Score:4, Insightful)

        by bechthros ( 714240 ) on Thursday March 10, 2005 @09:26AM (#11898664) Homepage Journal
        Economic coercion is still coercion. If Intel made better chips, they wouldn't need to cut off the competition's balls. If economic coercion becomes accepted as standard business practice, it will be VERY detrimental to marketplace competition (which is to say, competition based on the merit of the actual product and not consumer loyalty) and therefore VERY detrimental to real Capitalism.

        Film at 11. [maxbarry.com]
      • Of course, Intel did not actually threaten to initiate force against their customers (theft, fraud, extortion, murder, rape, etc). If they had, there would be no debate over the ruling. Intel only "threatened" to stop engaging in voluntary trade with their customers! Can you not see the difference here? Or were you deliberately trying to present the case as an actual threat of force? The fact is that Intel's customers voluntarily chose to do business with Intel, and they can voluntarily choose to end that
    • I wonder if MS might be the next in line for this sort of thing? After all, it's been shown repeatedly that they use the threat of cutting off supplies of their products if a manufacturer even thinks about putting non-MS approved software on as part of a preload. Maybe some of our Japanese Slashdotters could point this out to their government. It would be wonderful to see MS be declared a criminal organization is yet another country.

      Just my $.02,
      Ron

  • What!? (Score:5, Funny)

    by kunwon1 ( 795332 ) <dave.j.moore@gmail.com> on Thursday March 10, 2005 @06:01AM (#11898105) Homepage
    Intel? Antitrust!? I don't believe it! I'd sooner believe that Linus Torvalds switched to a new OS!
    • lol, I wouldn't. You say that as if Linus doesn't still use linux.

      Sheesh - I don't even know why that even got reported - Linus got a computer for free and he's actually using linux on it!
    • new architecture (Mac with PowerPC)? not a new os (still linux only)...

  • Hey Intel... (Score:3, Interesting)

    by BackInIraq ( 862952 ) on Thursday March 10, 2005 @06:04AM (#11898107)
    ...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.

    • Re:Hey Intel... (Score:4, Insightful)

      by Bralkein ( 685733 ) on Thursday March 10, 2005 @06:42AM (#11898226)
      Are you really surprised? Intel and all large corporations exist to make their organisation more valuable. They all push the law just as far as they think they can get away with... but this time, they judged wrong. I'd love to know about all of the dodgy shit that even fairly reputable organisations get up to, because I suspect there's an awful lot more of this stuff going on than your average person knows about.

      I always think of it like this: they're not immoral, they're amoral. They just don't care about right or wrong, they can't afford to, because that's how the system works. I'm glad that they got caught, and I think we need much more government constraints put in place and have them actively enforced to prevent things like this from happening.

      Of course, for that to happen, I'd need to buy myself a politician or two... and I'm only a poor student... care to give me a donation anyone? ;)

  • Standard PR response (Score:5, Insightful)

    by Anonymous Coward on Thursday March 10, 2005 @06:07AM (#11898113)
    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."

  • Obligatory (Score:2, Funny)

    by m50d ( 797211 )
    Computer manufacturers are already being sued in anti-trust cases...in Ja- oh, never mind

  • It seems a bit harsh (Score:2, Insightful)

    by Phidoux ( 705500 )
    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.

  • Woo! (Score:5, Funny)

    by Anonymous Coward on Thursday March 10, 2005 @06:11AM (#11898125)

    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!

    • 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!

      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?

    • 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??

      Well, I'd at least wait until a conviction comes down ;-) Accused != convicted.

      Oh, and they'd have to be told by the courts that while what they were doing was wrong, that they could keep on doing it.

  • Intel in Antitrust trouble... in Japan! (Score:3, Funny)

    by Anonymous Coward on Thursday March 10, 2005 @06:15AM (#11898136)
    Intel in Antitrust trouble... in Japan!

    The meme works.
  • 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 [clari.net].

    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.
    • except Intel is almost completely dominant in Japan and this doesn't go against the number 2 maker in the US, AMD. Even if the weak dollar could be blamed, it wouldn't make much sense to 'protect' Japanese businesses in an area which those businesses don't exist.

  • Last sentence was edited out by slashdot editors (Score:5, Interesting)

    by vincecate ( 741268 ) on Thursday March 10, 2005 @06:24AM (#11898179) Journal
    But if Intel really believes this is "fair and lawful", why is it that Intel does not use written contracts for these deals? [asahi.com]

  • Antitrust intel? (Score:2, Interesting)

    by vidarlo ( 134906 )

    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.

  • What's missing the from Intel statement (Score:5, Insightful)

    by Laurentiu ( 830504 ) on Thursday March 10, 2005 @06:30AM (#11898196)
    "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.

  • How do they know? (Score:2, Interesting)

    by TLLOTS ( 827806 )
    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'
    • Every company that has a product to market has a competitor. Said company always does extensive research on competitors to see what they're doing.

      It would not suprise me in the least that Intel knows where AMD is at, and AMD knows where Intel is at. It just makes good business sense; if not only to try to grow into areas where your competitor does well.

      The company I work for has a pretty decent research staff that investigates "competitors". You need to try to stay one step ahead of the game; being bli
  • 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...

  • I'll give you an example... (Score:5, Funny)

    by jpiggot ( 800494 ) on Thursday March 10, 2005 @06:46AM (#11898236)
    Some people seem to be confused; let me help to explain. If I liked listening to "Pennywise" and bought all their CD's, and Ashley Simpson found out about it and charged me EXTRA to purchase her limited edition concert DVD with bonus interviews, AND if we both lived in Japan...I'd legally be allowed to force her to commit suicide in the town square. With a kitchen knife.

    It's a rich and vibrant culture those Japanese have, I tell you.

  • Dell and AMD (Score:4, Interesting)

    by Anonymous Coward on Thursday March 10, 2005 @06:55AM (#11898255)
    Could it be for a similar reason that Dell reinstated that they will stick to Intel chips despite the lead of AMD in 64 bit processors.

    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.

    • 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 t
  • 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.

  • Intel continues to believe... (Score:4, Funny)

    by bani ( 467531 ) on Thursday March 10, 2005 @08:45AM (#11898362)
    ...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...

  • Sick minds running corporations (Score:2, Insightful)

    by Anonymous Coward
    "Intel continues to believe its business practices are both fair and lawful."

    After doing what Intel did, I can't believe someone would say this with a straight face. What a world we live in.

  • Replace REBATE with BRIBE (Score:3, Insightful)

    by lcsjk ( 143581 ) on Thursday March 10, 2005 @09:26AM (#11898663)
    Consider this, "If you buy 100,000 of our product your price will be $1,000,000 for the lot. However if you agree to buy fewer or none of the competing AMD product, we will sell you the lot for $900,000."

    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 ;) ].

  • Counter Justice (Score:3, Interesting)

    by Doc Ruby ( 173196 ) on Thursday March 10, 2005 @09:38AM (#11898778) Homepage Journal
    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?
  • AMD has complained before. And probably cot minimal investigation:

    [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?

  • 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 specif
  • 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
  • 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, an
  • "Intel continues to believe its business practices are both fair and lawful."

    I thought they said "...air and awful." ;-)

  • While Intel responded saying, "Intel continues to believe its business practices are both fair and lawful."

    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, th

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