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Intel The Courts Your Rights Online

Intel Fires Back At FTC In Antitrust Suit 122

adeelarshad82 writes "Intel has responded to the Federal Trade Commission's antitrust investigation, unsurprisingly challenging the FTC's allegations as well as criticizing the agency for what the company calls an attempt 'to turn Intel into a public utility.' The motion is a response to the FTC's December announcement of a lawsuit brought by the FTC, accusing Intel of anti-competitive practices. Intel also goes on to provide a paragraph-by-paragraph rebuttal of the FTC's complaint and proposed remedy, although most of the company's response seems designed to promote the impression that those that failed, failed on their own."
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Intel Fires Back At FTC In Antitrust Suit

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  • by JoshuaZ ( 1134087 ) on Friday January 15, 2010 @02:18PM (#30781580) Homepage
    The general problem Intel has is that at a default level even before any of the facts are in, chip-making is an area where anti-trust concerns make a lot of sense, more so than they necessary do in other areas (such as software). Chip-making has massive initial start-up cost. Thus, it is like the classic economic example of the steel mill where it is almost impossible for new competitors to enter the market. Thus, even if Intel shows that they haven't actively abused their role (such as the FTC's claims about Intel threatening buyers about loss of discounts in event of them buying from competitors) there might still be a strong case for some form of intervention.
    • Thus, it is like the classic economic example of the steel mill where it is almost impossible for new competitors to enter the market.

      That steelmaking is an area where a lot of people do enter the market. The USA and the UK blew up every steel mill in Germany and Japan during World War II, but, the lead the USA had in steel was destroyed not even 20 years after the war.

      • Re: (Score:3, Insightful)

        Was that due to competition or what the unions did which drove costs up for the US steel plants?

        • by Amouth ( 879122 )

          Was that due to competition or what the unions did which drove costs up for the US steel plants?

          Competition - Japan has some of the best quality - and even a nearly exclusive ability to forge some parts (an example)


          it's an interesting read

        • Was that due to competition or what the unions did which drove costs up for the US steel plants?

          It was competition using a different technology. Have you read "The Innovator's Dilemma" by Clayton Christensen? The steel industry is one of the examples he deals with, where a change in technology forces large incumbents to be utterly trapped by business logic and their extensive installed base of a previous technology.
          The unions chipped in, of course, but were far from the major factor.

          • It was competition using a different technology.

            The happened to nearly every postwar US industry. Basically, US capital stock was not destroyed, and, with no competition, there was no perceived need to invest in it, so they didn't. A lot of those plants shuttered in the 1970s and 1980s were based on 1930s tech. Presses, stamping machines, etc, were all OLD. But Japan and Germany had to start from scratch - and frankly, Japan was never industrialized even prior to WWII, so they tended to get newer equipme

        • by geekoid ( 135745 )

          The union is a scape goat cor US Steel plants. The act is the owners of those cmpanies sold key technology and trade secrets to other countries. For a few million dollars they sold the core asstets to countries that can get people to produce things cheaply because there cost of living was so low compared to our.

          Yes there wer some issues with the union, and no they weren't saints,

          Fact of the matter unions tried very hard to keep resource in the country and tried to get people to buy American. If people kept

          • If labor is 75% of your recurring cost, and unions are driving that up even higher, then yes they can take the blame. It's only natural that a country which has 1/10th the labor costs ($5.00 an hour instead of $50) will have the competitive advantage and drive U.S. companies into non-existence.

            Of course in a truly competitive free market, eventually jobless Americans will become desperate enough to accept those $5.00 an hour wages, and then the U.S. steel industry will be revitalized. We have not yet reac

    • Re: (Score:2, Insightful)

      by rickb928 ( 945187 )

      Interesting, and I had to put away my mod points and respond.

      "it is like the classic economic example of the steel mill where it is almost impossible for new competitors to enter the market"

      I suspect that if this is the theory the FTC is presenting, Intel is correctly going to counter that this is neither sufficient grounds for additional restrictions, nor is it actually a hindrance in today's or even last year's market.

      There are some competitors to Intel (AMD) that don't even OWN fabrication facilities. T

      • by lorenlal ( 164133 ) on Friday January 15, 2010 @02:53PM (#30782102)

        Intel has a good point. If the a major point of the FTC's inquiry is that they have an integrated presence in the market, then is Intel being penalized partly for merely being successful, and making good business decisions? Pah. They are in a competitive business. AMD is suffering as much for their choice in manufacturing partners as anythuing right now. Design aside.

        I believe that the major points in the FTC's inquiry involved Intel essentially holding their immediate customers over a barrel involving pricing of their chips. Specifically: []

        By leveraging their market position, Intel provided "rebates" to customers who went with Intel exclusively. When a computer maker wanted to offer AMD-based systems, Intel would threaten to raise their per-chip cost to a point where the maker couldn't compete. There are plenty of other notes. Please feel free to review and comment.

        • My point was that the FTC's complaints that Intel has an abusive position due to their assumed manufacturing advantage is not a good thing.

          Mind you, Intel's holding customers over a barrel with a combination of exclusive marketing agreements and coop funds is probably a pretty good bet for the FTC. It seems to meet a common-sense definition of restraint.

        • by geekoid ( 135745 )

          Starbucks gives me incentives to only buy my coffee from them, should they be shut down for that?

          • If they said, "We caught you buying coffee at McDonalds. If you do it again, we will double your price. If you don't, then we'll sell our coffee 10 cents below Mickey D's price"..... then yes they would be drug into court by the FTC for violating antitrust law.

        • >>>FTC's inquiry involved Intel essentially holding their immediate customers over a barrel involving pricing of their chips

          The record companies were sued by the FTC for similar acts ~10 years ago. They told retailers like Walmart, Target, et cetera that they *must* sell CDs for $12 minimum, otherwise the stores would be cutoff from the supply. The FTC almost won their case, but then the record companies agreed to pay a huge fine just prior to the final verdict.

          I would not be surprised to see Int

      • They can, and they should since there are plenty of legitimate problems they could have with intel in the anti-trust sense.

        personally though it doesn't bother me too much since AMD is for the most part a legitimate competitor to intel while my ISP on the other hand has been a (quite abusive) monopoly in my area since always.

        • Your ISP is a monopoly because it colluded with government to GET that monopoly.

          It's Crony capitalism is action - bribe the politicians and get an exclusive license so you don't need to compete. It isn't a true free market, because the government shot the free market in the head and now it's a government-run market.

        • personally though it doesn't bother me too much since AMD is for the most part a legitimate competitor
          For the moment they are still a player at the low-midrange. The trouble is that stuff makes relatively little money. Most of intels competitors in the PC processor market have been gradually killed off because of both the huge economies of scale intel has and the fact that intel could make the big margins on the high end stuff.

          AMD pulled a rabbit out of the hat (opteron/athlon64) while intel was slumbering

      • by Chris Burke ( 6130 ) on Friday January 15, 2010 @03:01PM (#30782202) Homepage

        I suspect that if this is the theory the FTC is presenting, Intel is correctly going to counter that this is neither sufficient grounds for additional restrictions, nor is it actually a hindrance in today's or even last year's market.

        That is not the theory the FTC is presenting, and the issues that the FTC is investigating don't involve today's or even last year's market.

        The theory involves intel's business practices over many years and their efforts to lock out or marginalize them by making agreements with OEMs that said they were required to do exactly that or be at a huge competitive disadvantage vs everyone else who was willing to play ball with Intel. Just as one example.

        There are some competitors to Intel (AMD) that don't even OWN fabrication facilities. They have access to competitive foundries that can produce their product.

        Yes AMD chose to spin off their fabs, because they literally had no other choice. Debt was piling up, and this made securing the incredible amount of funding necessary to build new fabs impossible.

        But barring their own spun-off fabs, no they do not have access to "competitive foundries" that can produce their product. Intel was already ahead of AMD's fabs, and AMD's fab is ahead of all the foundries (not counting that AMD uses SOI and all the foundries use bulk), who have neither the capacity nor the time to dedicate to tweaking their processes specifically for AMD's needs so they have a chance of remaining competitive with Intel. AMD is just as dependent on "their own" fabs as ever.

        That said, Intel having a fab and AMD selling theirs off (though it's still on AMD's books) is not the FTC's complaint as TFA explains. You rread a lot into the OP that wasn't really being said. They just said anti-trust made sense in chip sales because of the barriers to entry. The actual issue was and is anti-trust, not the barrier to entry itself.

        Similarly, competitors such as Freescale etc.

        Sorry but LOL.

        The FTC is not chartered to address a competitor's poor choices, if indeed AMD made a poor choice in being fabless.

        That's right, they are chartered to address anti-competitive business practices on the part of the monopolist, which is what they are doing.

        Intel has a good point.

        Intel is not making the point you think they're making.

        Also, they will of course say they have a good point, but it's the exact same points they made to the Japanese and EU trade commissions and during AMD's lawsuit against them, and they didn't fly then. Our FTC seems to move even slower than the others, but part of the reason they're waiting so long and talking about issues from the past is because they have spent a long time investigating and gathering evidence to make their case.

        Assuming they have some of the same evidence as the EU that I've seen, Intel doesn't have much of a chance. Though even without that, anyone paying attention through the 90s and early 00s knows what Intel was up to.

      • by ppanon ( 16583 )

        Now, if the FTC thinks Intel has an unfair advantage because they own their fabs, well, AMD chose a different route. Emphasis on CHOSE.

        I'm not convinced it was a choice but instead suspect they were coerced by market forces. AMD doesn't have the multi-billion dollar war chest that Intel has to be able to spend on new multi-billion$ fabs. So when AMD needed to build a new fab for the next process generation, they would have needed to borrow lots of money at a time when the banks weren't lending even if you o

      • Re: (Score:2, Flamebait)

        >Interesting, and I had to put away my mod points and respond

        Finally someone that gets the big picture, and thinks this whole intel debate is really another plow by FTC to generate its own revenue...seeing as imo intel has done nothnig wrong...and amd sucks the big one.

        I wish I too had kept some mod points, but alas, I can only give you my imaginary ones....
        consider yourself +5 underated.

        • Re: (Score:1, Funny)

          by Anonymous Coward

          Finally, someone that gets the "big" picture by not understanding any of the "little" picture, like what the hell the FTC is actually complaining about!

          IMO Intel has done nothing wrong, because I have no idea what Intel is alleged to have done!

          The FTC is just after revenue! My imagination of what the investigation is about tells me so!

          Wait, WTF does RTFA mean?

          • Of course when we are talking about a big picture, it usually goes beyond the scope of just one article, as such, usually including all of them and then coming up with a sort of up to date tally
            of what's going on...that would be including all the lawsuits that the FCC has come out with (and there are some really creative ones) as well as all the claims that Intel has had to deal with.

            So for the sake of keeping your post alive a little longer seeing as you set out to "teach me something"...let's look into wh

      • by geekoid ( 135745 )

        How much of the Fabs Intel doesn't sued are own wholly or proportional by Intel? Can Intel uses it's market to influence pricing at other Fabs?

        Also, Intel could by up critical parts need for a fab in order to delay building a new one which would severely impact AMDs market window for a product.

        I don't know the answer, but those are some very good reason the FTC would have a problem.

      • You make it seem like AMD has always been fabless. They just finished their spinoff of their foundries and did so because they couldn't afford to run them anymore. Which pretty much makes your point irrelevant. Also, investors and followers of AMD have held the move up as a great move for saving the company from bankruptcy (or more likely, acquisition from IBM). Futhermore, you failed to mention even one word of why the FTC brought the case about in the first place. Intel selling their chips at cost or be
        • Which AMD has sued successfully over (Intel settled and agreed to pay $1 billion and agree not to sue about their splitting off their foundries).

          AMD successfully got money out of Intel. That's all it means.

          Does anyone have a link to actual evidence where Intel sold chips below cost? I've heard of emails where they threatened to up prices when a customer decided to not be exclusive... but I haven't seen any proof where they went through with it. I'll have to wait for the final verdict to form my opinions... you know... once the FTC actually investigates.

          Right now I'll give Intel the benefit of the doubt. But I'll be disappointed if it com

      • Re: (Score:3, Insightful)

        by hairyfeet ( 841228 )

        I think what is ultimately screwed Intel is the fact that they paid their OEMs to NOT use any AMD chips, and made it clear that any discounts would go bye bye if so much as a single AMD chip went out the door. I wish I could find the link, but as another poster says Intel puff pieces dominate Google right now.

        But you can find proof of it probably in your very own home. Remember back five years ago, when Intel was running Netburst, which was a pig for power, ran like a space heater, and was slower than just

    • Re: (Score:3, Insightful)

      by Locke2005 ( 849178 )
      CPU manufacturing is what is known as a "natural monopoly"; I really don't think the global market can support more than 3 companies doing this. That still doesn't justify Intel's use of "co-marketing" money, wherein Intel pays all of PC vendor's advertising costs, but only if they don't use competitor's chips. Intel is willing to do practically anything for a "design win", but that is just good ol' fashioned competition. Unfortunately, it is difficult to separate the effects of Intel's anti-competitive beh
      • Just because Intel has risen from the p4 era with competitive chips doesn't mean that it was on their own efforts or merit. They did so by licensing technologies developed by AMD and holding the necessary set of legacy patents over AMD's head as payment for these techs. If anything Intel's recent success stems for their quality first-party fabs that can produce high internal clock speeds. The sad fact is that even with governments intervening Intel has already gained their advantage by having the funds n
        • Had we seen fair market pressure, I'm tending to think that the 8086 would have died the death a long time ago.

          In fact, I'm tending to agree with the idea that intel's need to sell processors is the only remaining reason for the continued existence of the desktop PC.

      • Re: (Score:2, Informative)

        by StayFrosty ( 1521445 )

        CPU manufacturing is what is known as a "natural monopoly."

        No, it's not. According to Wikipedia: "In economics, a natural monopoly occurs when, due to the economies of scale of a particular industry, the maximum efficiency of production and distribution is realized through a single supplier, but in some cases inefficiency may take place.

        Natural monopolies arise where the largest supplier in an industry, often the first supplier in a market, has an overwhelming cost advantage over other actual or potential competitors. This tends to be the case in industries wh

        • Re: (Score:3, Interesting)

          by Locke2005 ( 849178 )
          ARM is a CPU designer, not a CPU manufacturer. I probably should have restricted my statement to x86 compatible [] or PC CPUs; there is room for more than three embedded CPU manufacturers. If we're talking about companies that actually have the fabs to compete with Intel, we're talking AMD, IBM, and TSMC. Possibly also UMC, Fujitsu, and National Semiconductor. So you are correct, about 7 companies, not 3. With multi-billion dollar barriers to entry, the high-end semiconductor industry does look a lot like a na
      • by Korin43 ( 881732 )
        Natural monopoly? Without the government stopping other companies from making compatible processors, there would be a lot of competition. If you look at other places where processors are used, you notice that no one has any problem competing. The only reason Intel/AMD have their oligopoly (duopoly?) is because no one else is legally able to compete with them.
      • >>>CPU manufacturing is what is known as a "natural monopoly"

        Completely and totally wrong. A natural monopoly relates to physical space where, for example, you can't have 4 or 5 companies supplying water to your house, because there's not enough room to bury 5 sets of pipes. That physical restriction imposed by NATURE means there can only be 1 company serving you with water. Same applies with natural gas and electricity.

        CPUs have no restriction imposed by nature. Just as we have ~100 car co

  • From the article "In 26 statements of "contemplated relief" contained in its complaint, the FTC described what Intel's must do and not do to preserve competition."

    Right, because when I think of people who know how to run a business (ya know, an entity with 10 trillion dollars in debt), I think of the Federal government. Who are these people who think they know how to maintain competition? Obviously not people who can make it in the private sector so they go work for the FTC and act like little emporers, "st

    • by JoshuaZ ( 1134087 ) on Friday January 15, 2010 @02:26PM (#30781698) Homepage
      Actually, anti-trust issues are exactly the sort of thing that needs to be handled by the government because no one else is in a position to do so. There are many good reasons for anti-trust issues: 1) large controling companies in industries can hurt customers, stifle competition and stifle innovation. 2) They make industries and the economy as a whole more vulnerable to sudden fluctuations (look what happened in the banking industry. That was in part because the largest banks were too large. Unfortunately, we haven't really dealt with that part of the problem...). The FTC doesn't need to know how to run a business. They just need to know how to identify anti-competitive practices.
      • Re: (Score:2, Insightful)

        by DigiShaman ( 671371 )

        There is a huge difference between anti-trust action, and State take-over of a company. We've already seen this happen to the Banking and Auto industry. Both have been epic failures on all fronts! Do we as a nation want the Federal Gov taking over the direction of how Intel conducts business and even production?

        If any of you said "Yes" to my last question, then you are a Facist/Statist and should be drug out on the street and shot IMHO!!! This cannot be allowed to stand.

        • Re: (Score:3, Insightful)

          The Federal Gov't. didn't force a takeover. They said "here's some money, it's comes with strings attached". The banks hoped those strings wouldn't be enforced, but that hasn't been the case(thankfully). A lot of banks have opted to pay the money back. I sincerely doubt this would have been the case if they had just been given a blank check.

          The automakers are just F***** and have been for a long time. Their bailout was to soften the blow of all of them going down in close proximity, and at a time when th
          • They said "here's some money, it's comes with strings attached"

            Actually it was more like "They said "here's some money, it does not comes with strings attached please save us from impending doom!11!!"

        • Re: (Score:2, Insightful)

          No one said the government was taking over Intel and don't you have a town hall meeting to attend to proclaim Obama an illegal immigrant or something?
        • Government takeover of intel is a great idea!

          Best way possible of seeing to it that the 8086 line could disappear like it should have decades ago.

    • Give IBM 700 billion dollars and I guarantee that the unemployment would be well below 10% (or 17% real unemployement).

      In India, maybe.

    • Bureaucrats at the FTC don't write the federal budget; that gets decided by congress which is largely owned by business interests.

      The US government isn't just some monolith with no capacity for competence; it's pretty much legislators and the military portion of the executive that cause all of the country's problems.
      • Because your someone who has absolutely no understanding of civil society. You believe in the myth that government is meant to take care of the people. You think, for some reason, that the "military" is a cause of all the problems, when it is simply an appendage of the civilian government (at least in western democracies). Of all the things the government does, the military is actually something that it is constitutionally designed to do. But I'm sure you dont care about the constitution.

    • From the article "In 26 statements of "contemplated relief" contained in its complaint, the FTC described what Intel's must do and not do to preserve competition."

      Right, because when I think of people who know how to run a business (ya know, an entity with 10 trillion dollars in debt), I think of the Federal government.

      "Preserving competition", which is what the FTC is saying what must be done to do, and "running a business" are distinctly different, and often opposed, goals. Someone running a business want

    • Re: (Score:3, Insightful)

      Preservation of competition is about maintaing the health of the consumer market. The FTC isn't saying that Intel doesn't know how to make money, but that their practices are threatening to the maintenance of a robust competitive market. Capitalism without a framework of rules and standards that is about as sustainable over the long-term as the communist shadows your sig line is barking at. Take it from a left wing progressive: The policies put forth by Obama are centrist. The center has just been far e
      • I dont quite understand what you mean, "capitalism without a framework". What framework does capitalism have? I understand the role of government, but by and large it has been disastrous. Capitalism doesnt have a framework. In fact, a free society and a capitalism is the antithesis of a "framework". The government is what is suppose to have a "framework", which you progressives tend to want to ignore as best you can.

        By calling Obama centrist, you are either being deceptive and obtuse, or you are ignorant of

        • By calling Obama centrist, you are either being deceptive and obtuse

          By averge democratic country standards, President Obama is a moderate centrist/right-winger.

          In the US, I suppose political terms must all mean different things to what they mean in Europe. 'Liberal' is a term of abuse used by right-wingers against left-wingers in the US, but in Europe many right-wingers would describe themselves as 'true liberals'.

          (I'm assuming you think he's a 'socialist'; if that's not what you meant I'm sorry I misunders

        • No time for a concerted thesis on this, esp since we're going pretty far afield, as is good and proper in such a forum. Perhaps more later if I find myself with the time. Some Thoughts: The system was already going down. I smelled the crap in Greenspan's pants from halfway across the country. The Community Reinvestment Act, as it was originally designed, was put in place to help alleviate the institutional racism experienced by African American communities which were subjected to discrinatory lending p
          • There is a lot of statist activity since Reagan, and unfortunately it has acted as nitrogen in an algae bloom. Arguing against statism and socialism is not an argument for unfettered capitalism. Unfortunately, this is the straw man argument of the left, either you are for their version of society, or you are for anarchy, robbing children, dragging old people into the street to be shot, etc.. No, the argument of most of those "tea bagging, red necks" (to quote a homophobic racist term thrown around by the in

            • So, when you said "Capitalism doesnt have a framework. In fact, a free society and a capitalism is the antithesis of a "framework," and I responded with a broad attack on the history of laissez-faire capitalism in our country (and others, for that matter), I was implying you were making an argument for violent anarchy, somehow? You just used a strawman to paint a picture of a strawman suit on a pseudo-specific argument. I'm impressed. Seriously. You bullshit like I bullshit, and we should do this more o
              • No matter how you sugar coat it, "Redneck teabagger" is both racist and homophobic, no matter how you rationalize it (such as calling all Tea Party activists homophobes). The phrase who "tea bag" concept came from a campaign where anti-socialist activists mailed "tea" to congressmen as an expression of contempt to unconstitutional expansion of government authority (please, can we just skip over article 1 section 8 of the constitution already, Madison dismissed it out of hat in the federalist papers over 200

                • Just for the record, you don't have to be white to be a redneck, or gay to suck balls. Capitalists built railroads on the backs of pressed Chinese and Irish workers, built power plants that ruined rivers, created hospitals that only the only the wealthy can afford and on and on. The issue we are having in this little back and forth is that we're both stubborn bastards, so I'll drive to the heart of the issue to maybe get us to a more peaceful place on all this. What we're talking about here is the corrup
    • Because Intel only has the consumer's interest in their heart and will never do anything wrong.

      Before you say the consumer should decide just remember it was the consumer who decided who is in the government.
  • by i_ate_god ( 899684 ) on Friday January 15, 2010 @02:29PM (#30781738)

    I could have sworn that at one time, the Athlon was king of the world, then the Core 2 Duo's came out and Intel was king of the world since because AMD hasn't made a superior CPU.

    Is Intel supposed to purposefully degrade the quality of their product? What is it that they did that has the FTC crying foul?

    • by Rockoon ( 1252108 ) on Friday January 15, 2010 @02:33PM (#30781824)
      ..because even when AMD was price AND performance king of the x86 CPU, Intel still sold more due to market manipulation.
      • And that had nothing to do with production capacity?

        • Re: (Score:3, Interesting)

          by cheesybagel ( 670288 )
          AMD could not manage to sell their processors for more money, because Intel basically used their cash reserves and market power to undermine AMD. Intel basically threatened manufacturers that would buy AMD that they would suddenly start paying much more expensive prices, than Intel exclusive manufacturers. This caused AMD to lose a lot of customers. It was claimed AMD got its first major OEM win (Compaq) by essentially giving its processors away for free. If AMD had sold its processors for more, they could
          • AMD could not manage to sell their processors for more money, because Intel basically used their cash reserves and market power to undermine AMD. Intel basically threatened manufacturers that would buy AMD that they would suddenly start paying much more expensive prices, than Intel exclusive manufacturers.

            I may have heard this from a bias source, but I heard it explained like this (I'll paraphrase)
            == Rebates are always offered for volume in this industry. If a company like Dell is going to order 2M units total, then 2M from Intel should cost less per unit than buying 1M units from Intel (and 1M from AMD).==

            Now, if Intel charged different amounts per chip for Dell buying only 2M from Intel vs 2M from Intel and 1M from AMD - then I see that as anticompetative. But nobody has yet to make that distinction

            • by Belial6 ( 794905 )
              Ok, I'll make that distinction for you:

              == Rebates are always offered for volume in this industry. If a company like Dell is going to order 1M units total, then 1M from Intel should cost less per unit than buying 1/2M units from Intel (and 1/2M from AMD).==

              The 1M in that quote was a variable. They just used 1M so that is sounded less like an equation. Changing the numbers to 2M and 1M does not change the original quote at all.
              • Yes, the equation stays the same, I agree... but that still doesn't say Intel charges less per unit for an exclusive X units than a non-exclusive X units...

                That is the distinction I need to be convinced they did anything wrong in their pricing.

                Perhaps this can be seen in the advertising deals.. not sure.
            • That was not what I heard. I heard Intel wanted exclusivity, it was not directly related to number of units sold. It was related to the percentage of units sold with Intel processors. AMD sued Intel in Japan []. Intel was IIRC fined in Korea and the EU [] for monopoly practices. Citing the last link:
              • Intel gave rebates to computer manufacturer A from December 2002 to December 2005 conditional on this manufacturer purchasing exclusively Intel CPUs
              • Intel gave rebates to computer manufacturer B from November 2002 to
        • by reiisi ( 1211052 )

          Sure it had somewhat to do with production capacity.

          What was your argument?

      • Re: (Score:3, Insightful)

        by phantomfive ( 622387 )
        Or maybe Intel just has a really awesome marketing department. Seriously, have you ever heard of 'AMD Inside?' I heard stories of executives in the 90s who would say things like, "I don't know what that Intel stuff is, but I want some of it in my computer." I'm not sure if what Intel did market manipulative things or not, but they definitely rocked AMD on the marketing front.
        • it would be really, very surprisingly if AMD could have won out in the long run against intel. that's what makes intel's actions all the more perplexing.

          the problem is that no one has a crystal ball that is going to tell us how much intel's market manipulation contributed to their success. if they manipulated the market, they have to pay for it regardless of how much of an effect it had. i hope for them it had a big effect considering the deep poopoo they are in because of it.

        • I can remember when a marketing ploy like "intel inside" would have gotten intel laughed out of the industry. I remember similar marketing slogans in the mid-80s that were generally viewed as, and mostly proved to be swan songs.

          Blatantly tooting your own horn is usually detrimental to market share.

          (Except in pro wrestling, where the market is not really interested in anything meaningful.)

    • I can't quite remember the details, but I think basically what they did was throttle their hardware if its running in synch with their competitors products, for no apparent reason besides making their products look better.

      Can someone back me up on that? Or did I make that up in a dream one night...

      • Re: (Score:1, Funny)

        by Anonymous Coward

        You're all alone on this.

      • by Amouth ( 879122 )

        The only one i remember is the Intel Compiler optimizations only working on Intel CPU's..

        Such as doing some math tasks via MMX - even though AMD's had MMX the compiler wouldn't put in the optimizations unless the CPU was identified as Intel.

        People got pissed because Intel's compiler was the defacto default for a alot of people - but if you think about it - why should they be responsiable for optimizing a compiler for a competitors CPU? and dealing with all the bug checkking that has to go into it.

        Say they h

    • I think part of the problem is Intels business practices. Namely: While Athlon was "king of the world" Intel cut out AMDs share, not due to better product or prices, but tue to unfair business practices.

      That being said, this case would have been much more appropriate then.

    • by Chris Burke ( 6130 ) on Friday January 15, 2010 @02:40PM (#30781924) Homepage

      Actually it's Intel's business practices during the time (and before) Athlon was "king of the world" that are at issue. They fed companies "cooperative marketing" funds (read cash handouts and sweetheart pricing deals) via the "Intel Inside" program that were not based on how much Intel product they moved, but rather on them not selling AMD parts. There were companies that wanted to sell more AMD, but couldn't because with the amount of money Intel was giving them, it simply didn't make sense. They would have been crushed by competitors who were willing to play ball with Intel.

      Thus was Athlon's marketshare artificially limited, which can be seen as a cause of AMD later falling behind. There was a brief period in the K8 days where AMD was fab capacity limited, but this too is because AMD had not secured enough revenue from Athlon to build as aggressively as they would have otherwise.

      As usual, legal entities like the FTC move slowly, and the issues they actually act upon are thus well in the past. Not that Intel stopped engaging in these practices until (possibly) very recently, when other trade organizations around the globe started hammering them and AMD's lawsuit against them was settled in AMD's favor. It's just understandably harder to see the business practice issues when Intel's products are also superior.

      • by reiisi ( 1211052 )

        I still have a hard time keeping a straight face when I read "superior product" in anything describing x86 CPUs.

        Yeah, yeah, I know about the theoretical implications of turing completeness, but that's only if you have infinite memory and infinite time.

        We would be so much further ahead, software-wise, if the industry hadn't been hobbled by the necessity of all the standard tools maintaining compatibility with the x86 runtime. I mean, software still isn't really an engineering discipline because of the run-ti

        • by Agripa ( 139780 )

          I periodically see the x86 is holding us back discussion and find the arguments on the other side more persuasive. x86 (and ARM because it was designed as a 6502 replacement) offer a higher level of abstraction than the later RISC architectures and this ends up producing a performance advantage over time even without recompiling. Exposing low level details like delayed branch slots, memory ordering, and pipeline interlocks became a disadvantage after increasing integration allowed the higher abstracted x8

          • by reiisi ( 1211052 )

            Won't argue with the idea that the x86 and ARM architectures offer a execution models that can be separated from the iron more effectively than, say, the power PC.

            But if we can get beyond that point, the x86 model is just plain wrong. Screwball, really. And it gets in the way when you want a different execution model.

            If you want a really good, high-level model, the FORTH processor is much closer to an optimal general-purpose execution and computation model. It's missing a few points, too, but it's probably

    • by MobyDisk ( 75490 )

      This case takes place looong before the Core 2 Duos. You are dead-on about one thing: For a while, Athlon was the king - technologically. Yet they never could get a major vendor to ship their chips. This is because Intel used anti-competitive practices to lock-out AMD. The vendor contracts with Intel limited the percentage of machines they could ship with AMD chips.

      The FTC is not telling Intel to degrade their products. They are telling them not to make monopolistic contracts.

      • AMD was very open that they were capacity constrained during the time in question- they were selling everything that they could manage to manufacture. They made a few feeble attempts to increase their capacity, like the whole UMC debacle. But in the end, the limits on AMD's success were all self-imposed by crappy management. At its heart, the semiconductor industry is about manufacturing, and whoever can make the most chips with the highest yields will win. AMD still doesn't understand that.

    • by mpfife ( 655916 )
      Yeah, I don't understand this lawsuit at all.

      According to Slashdot - AMD has been the leader for year and YEARS now.

    • You are correct, to a point. At one point AMD was the performance king. However, even at that time when they clearly had the better processors, Intel was paying many different companies millions of dollars in the form of "exclusivity discounts" to not carry a competitors product. What if GMC paid all car dealers in the entire country to carry only Saturns. Would you go to another country just to buy a different make of car or just settle?

      Dell, HP, Gateway, and Compaq all received what amounts to bribes (in

    • by archer, the ( 887288 ) on Friday January 15, 2010 @03:16PM (#30782402)

      Also, there were rumors that if a motherboard manufacturer was thinking of making new AMD boards, Intel allegedly would hint that the manufacturer might face a shortage of Intel chipsets.,123-2.html?xtmc=athlon_boards_chipset_shortage_taipei&xtcr=2 []

    • Re: (Score:3, Insightful)

      by farble1670 ( 803356 )

      something like this:

      • intel: going to ship AMD-based systems are you?
      • PC manufacturer: yes.
      • intel: oh really. by the way, the price of that lot of intel CPUs you plan to purchase just doubled.
      • PC manufacturer: ...

      the PC manufacturer had to ship intel-based systems because there was some significant portion of consumers that recognize the intel brand name ... despite the fact that intel-based CPUs were inferior to AMD at the time. that's called anti-competitive practices ... for the obvious reason that AMD

      • Intel also put out a lot of BS says that AMD is bad / does not work right and they also push there own mother boards that some cost more and have less stuff on them then others with the same chipset.

        also they are now trying to lock out 3rd prat chipsets and on board video chips and replicating them with there own shit video build in to the cpu.

  • We just need to make a law from the following principal:

    Giving a discount based on the quantity a customer buys - Good Legal Business Idea

    Giving less of a discount based on the quantity of competitors products a customer buys - Antitrust problem.

  • if AMD went out of business and Intel cornered the market? How does that affect me as a consumer?
    Somebody please explain that.
    • by ITJC68 ( 1370229 )
      Computers (PCs) would cost roughly 3 times as much as they do today. CPU costs would be off the chart. When there is no competition prices soar. Also we would probably just be getting dual core cpus with maybe 2.3 ghz instead of the quad core 3 ghz models. Not to mention that apple would probably have far more market share because their pricing would have been way more competitive. Whether buying a ready made PC or building your own Money vs performance is always in the mix.
  • One of the problems is that Intel was proven to pay OEM's (Dell specifically) a large sum of money to delay the launch of Opteron based products. It's a long read but to get a better handle on this, I suggest reading New York's antitrust suit: []

When a fellow says, "It ain't the money but the principle of the thing," it's the money. -- Kim Hubbard