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FTC accuses Intel of numerous violations, including writing software to sabotage its competitors' hardware

Intel holds a dominant position in the computer industry, with over 79.1 percent market share in the microprocessor market, according to iSuppli reports from the summer (these reports included by x86 architecture microprocessors as well as alternatives like ARM).  In May 2009 the European Union's antitrust regulators fined the chipmaker $1.45B USD -- about a fourth of the company's 2008 net income ($5.292B USD) -- for allegedly using discounts and OEM payoffs to push its smaller competitor Advanced Micro Devices out of the market.  That ruling is currently being appealed.

In the U.S. the Federal Trade Commission has investigated similar claims.  The State of New York has filed suit against the Santa Clara, Calif.-based company for antitrust violations, but thus far no federal litigation had been filed.  That all changed today with the FTC suing Intel, citing numerous antitrust violations.

The landmark case comes on the heels of Intel's $1.25B USD settlement with AMD over similar claims.  Under that agreement AMD agreed to drop all pending and present litigation against its rival.  According to the FTC's lawsuit filing, Intel is depriving customers of free choice and is stifling the progress of the computer industry.  The filing says that Intel employed a carrot-and-stick sort of approach, using both threats and rewards to keep OEMs from using its competitors' products.  Reportedly Intel used such targets on Dell Inc., Hewlett-Packard Co., and IBM Corp.

One of the more interesting aspects of the case is that the FTC claims to have evidence that Intel wrote compiler software (Intel makes one of the more commonly used commercial C++ code compilers, the Intel C++ Compiler) to sabotage the performance of its competitors' CPUs.  Little is known about this allegation at this point.

Richard Feinstein, director of the FTC's Bureau of Competition, says Intel's violations are blatant and alarming.  He states, "Intel has engaged in a deliberate campaign to hamstring competitive threats to its monopoly.  It's been running roughshod over the principles of fair play and the laws protecting competition on the merits. The Commission's action today seeks to remedy the damage that Intel has done to competition, innovation, and, ultimately, the American consumer."

The FTC case looks to prevent Intel from employing "threats, bundled prices, or other offers to encourage exclusive deals, hamper competition, or unfairly manipulate the prices of its" CPUs.

Intel was recently fined $25M USD by the South Korean government for antitrust violations.  The FTC's investigation of Intel was first announced officially in June 2008.  Under the more pro-antitrust Obama administration the investigation has pushed ahead aggressively and now looks to place new fines or restrictions on the chipmaker.




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All I can say is...
By rudolphna on 12/16/2009 11:47:23 AM , Rating: 5
Finally. Intel, you've had this coming for a long time.




RE: All I can say is...
By Gungel on 12/16/2009 11:51:06 AM , Rating: 1
What took so long for the FTC to step in? We know about that for years and enough evidence has been shown by other countries that fined them for running a monopoly. Could it be that Intel's strong arm tactics reach into our government?


RE: All I can say is...
By quiksilvr on 12/16/2009 11:52:25 AM , Rating: 2
You need evidence from the US and not other countries. The most you can do is bring in witnesses that will testify if the FTC filed charges. But Intel most likely bribed people outside the country to avoid them from stepping in.

However, what is confusing me is that Intel paid AMD over a BILLION dollars to settle these anti-competitive lawsuits. I guess it wasn't enough.


RE: All I can say is...
By Motoman on 12/16/2009 11:58:53 AM , Rating: 5
That was between AMD and Intel. This is between Intel and the US gubbermint.


RE: All I can say is...
By MrDiSante on 12/16/2009 1:56:05 PM , Rating: 2
Yes and no. While that was between AMD and Intel a major perk that Intel got out of it is that AMD retracted all regulatory complaints against Intel. So, while the government may still go ahead and try to make a case against Intel, it gets a lot harder when your victim isn't about to testify.


RE: All I can say is...
By Ard on 12/16/2009 2:54:03 PM , Rating: 5
That's what the subpoena power is for. Aside from that, I'm guessing that while AMD may have been the loudest critic they certainly weren't the only one complaining. IIRC, NVIDIA still has quite a few complaints filed against Intel with the FTC and I wouldn't be surprised if ARM isn't involved at some level.


RE: All I can say is...
By lco45 on 12/16/2009 6:01:17 PM , Rating: 5
Classic example is nVidia's Ion chipset (ie. the bundled graphics and Atom CPU).

Intel, trying to protect its own horrible onboard graphics chipsets told nVidia they would charge an additional $20 for an Atom CPU if they were going to use it as part of their Ion chipset.

This directly damages the consumer, because we have now been waiting almost a year for Ion, which is a far superior netbook chipset, just so Intel can keep flogging their onboard graphics.

Luke


RE: All I can say is...
By knutjb on 12/16/2009 4:24:15 PM , Rating: 2
AMD wasn't the only victim and Intel broke many laws that don't require AMD to testify in order to prosecute. Dell and other manufacturers were also pressed into an illegal payoff scheme to only use Intel's products. Plus the AMD settlement can be used as evidence, even if AMD stays quiet. Sure it would be easier to have AMD on board but they still can be subpoenaed to testify in court regardless of Intel's deal.

I see Intel trying to settle out of court with the government. After all they have a huge lead on patents for the next generation CPUs for 128 bit OSes. Was the gamble worth it?


RE: All I can say is...
By xaders on 12/16/09, Rating: 0
RE: All I can say is...
By weskurtz0081 on 12/16/2009 12:02:57 PM , Rating: 2
Intel paid AMD to drop the suits THEY filed against Intel. That is not the same as any suits the State brings against Intel for breaking anti trust law.


RE: All I can say is...
By invidious on 12/16/2009 12:26:27 PM , Rating: 4
I don't see why the government deserves money just because intel broke the law. 100% of the "profits" of this suit (minus the legal fees and such) should be immediately pumped back into the industry to intel's competators.

Otherwise they are just taking an industry that has become solely reliant on a single supplier and crippled that supplier. So everybody loses.


RE: All I can say is...
By weskurtz0081 on 12/16/2009 12:41:55 PM , Rating: 4
Not that I disagree with you, to a certain extent I do, but if you were to try and do that it would open up a whole other can of worms.


RE: All I can say is...
By Motoman on 12/16/2009 12:42:30 PM , Rating: 1
quote:
just because intel broke the law.


...so, what, you think they should put all of Intel in jail for a few months then?


RE: All I can say is...
By Azuroth on 12/16/2009 3:37:13 PM , Rating: 4
Intel didn't break the law, PEOPLE at Intel did, so yes, someone should go to jail when the law is broken.


RE: All I can say is...
By SPOOFE on 12/16/09, Rating: -1
RE: All I can say is...
By knutjb on 12/16/2009 4:41:09 PM , Rating: 4
Who do you think? Real people committed numerous crimes in the name of the company, and yes even the CEO because it happened on his watch. Jail is a better motivator than money alone. The share holders should be mad too because the value of their holdings has gone down with every fine paid.


RE: All I can say is...
By albundy2 on 12/16/2009 10:04:26 PM , Rating: 5
Leave me out of this.

BTW, it's custodian not janitor! Or if you preffer "Enviromental Technician".

Besides, everyone knows it was Frank in shipping.


RE: All I can say is...
By gmljosea on 12/16/2009 12:54:52 PM , Rating: 2
I'm not sure of this, but what about forcing Intel to give up their x86 rights and make it open for anyone? That could perhaps pump some competition into the market.


RE: All I can say is...
By Motoman on 12/16/2009 12:56:49 PM , Rating: 5
This isn't about patents or IP. It's about illegal business practices - threats, bribes, kickbacks, blackmail...all the fun stuff that the mob gets to do.


RE: All I can say is...
By ajfink on 12/16/2009 9:17:25 PM , Rating: 2
It's about punishment. There's got to be a threat against breaking the law, otherwise people would do it all the time.

Think of it is a massive speeding ticket.


RE: All I can say is...
By omnicronx on 12/17/2009 8:27:54 AM , Rating: 2
quote:
I don't see why the government deserves money just because intel broke the law. 100% of the "profits" of this suit (minus the legal fees and such) should be immediately pumped back into the industry to intel's competators.
Its really not about the money, its a deterrent, this should be pretty obvious..
quote:
Otherwise they are just taking an industry that has become solely reliant on a single supplier and crippled that supplier. So everybody loses.
No Intel loses, you would be hard pressed to name an industry in which opening up the doors to more competition would be a bad thing for consumers. Crippling Intel would do just that.. open up the doors..

Now on the other hand I can think of many situations in which a company that completely dominates a market is a bad thing for consumers..


RE: All I can say is...
By Reclaimer77 on 12/17/2009 10:47:01 AM , Rating: 2
quote:
Crippling Intel would do just that.. open up the doors..


Umm no. "Crippling Intel" doesn't magically make competition better. Why don't we have 20 companies making CPU's right now ? Because they are extremely expensive to develop, the manufacturing investment to make them is astronomical, and your profit margins are very low.

Hurting Intel isn't going to magically make AMD better or new CPU companies pop up and start competing.


RE: All I can say is...
By omnicronx on 12/17/2009 7:14:52 PM , Rating: 2
Intel single handedly holds the PC market as we know it by the balls. The world runs on x86, its just not possible for a smaller company to persuade people on a mass scale to switch. So why don't we have 20 cpu companies right now? Well for one Intel has put pretty much everyone out of business who has tried, and nobody else, even those that want to can get into the x86 market as Intel won't license x86.

I'm not some crying AMD fan, I'm just looking at the facts, the PC market will be a much better place when the bulk of Intel's patents expire, thats for sure...


RE: All I can say is...
By aqwan135 on 12/20/2009 8:05:56 PM , Rating: 1
http://ta.gg/3yu

fr ee sh i pp ing

(jordan shoes) $32

(air max) $34

+++

wow


Wait a sec...
By zsdersw on 12/16/09, Rating: 0
RE: Wait a sec...
By dagamer34 on 12/16/2009 12:05:10 PM , Rating: 2
It should be compiler, not driver, in the article. And yes, that would affect performance since it's autogenerated.


RE: Wait a sec...
By zsdersw on 12/16/2009 12:11:55 PM , Rating: 2
A compiler, yes, that makes sense.


RE: Wait a sec...
By dsx724 on 12/16/2009 12:15:37 PM , Rating: 5
Intel writes a compiler suite for C++ and Fortran that disables all optimizations on AMD's CPUs even if they comply with Intel's vector extensions. So if someone uses Intel's compilers to optimize performance, it slows down the program on AMD's CPUs since the software does a GenuineIntel check and runs the slow code if it fails. That was what that entire program was about, locking competitors out of the market by slowing down the programs that people use if the processor is not from Intel.

That said, the reason antitrust is brought in is because Intel's Compiler is by far the easiest way to vectorize and parallelize x86 code. Only recently did Intel add support for allowing vector instructions to be use on rival CPUs and even still it requires the developer to explicitly check a box or use a special flag instead of automatically supporting it on all processors based on CPU Flags.


RE: Wait a sec...
By check on 12/16/09, Rating: -1
RE: Wait a sec...
By Spivonious on 12/16/2009 12:34:45 PM , Rating: 5
No, it would be like you buying a Ford and only getting the full engine if you used gasoline from Ford gas stations. If you filled up at Mobil, your engine disables 2 cylinders.


RE: Wait a sec...
By SPOOFE on 12/16/09, Rating: -1
RE: Wait a sec...
By Spivonious on 12/16/2009 4:52:40 PM , Rating: 2
No. Intel purposefully disabled functions that both AMD and Intel processors shared. Your analogy doesn't work.


RE: Wait a sec...
By ClownPuncher on 12/16/2009 12:38:01 PM , Rating: 2
Read it again...slowly this time.


How does this help the consumer?
By oxymojoe on 12/16/2009 12:01:52 PM , Rating: 4
How is hitting Intel with massive billion dollar fines like the EU going to help us as consumers? Will that drive costs up or down? Is this going to keep things fair somehow?. It is so transparently political, and our government bigwigs could care less about protecting consumers.




RE: How does this help the consumer?
By mcnabney on 12/16/2009 12:16:08 PM , Rating: 3
It can help pay down the debt. That is a good thing.


RE: How does this help the consumer?
By oxymojoe on 12/16/2009 1:16:18 PM , Rating: 1
So would ending the war in Afghanistan but as I recall were sending 30k more troops.


By ElrondElvish on 12/16/2009 1:36:06 PM , Rating: 2
It'll help consumers because Intel will be more gun shy pulling the same stunts in the future. Look at Microsoft. The antitrust actions from the 90's and 2k's have made them much less anti-competitive. They're still hardballers, but anyone who watches them knows they've toned down what they did in the 80's and early to mid-90's.


Ugh DailyTech - COMPILERS
By dagamer34 on 12/16/2009 12:06:07 PM , Rating: 2
Intel wrote COMPILERS, not DRIVERS. CPUs don't need drivers. =/




RE: Ugh DailyTech - COMPILERS
By mcnabney on 12/16/2009 12:17:13 PM , Rating: 1
Actually, my old AMD64 CPU did have drivers for their Cool N Quiet technology. Just FYI.


RE: Ugh DailyTech - COMPILERS
By themaster08 on 12/16/2009 3:23:55 PM , Rating: 2
Computing basics - every component and peripheral needs a driver.


Blockbuster suit?
By Phynaz on 12/16/2009 12:07:55 PM , Rating: 2
"blockbuster"?

Really?




RE: Blockbuster suit?
By Motoman on 12/16/2009 1:01:38 PM , Rating: 2
I hope it's not a blockbuster suit...if so, that would mean the suit itself is going to go bankrupt any minute now...


By masamasa on 12/16/2009 12:12:24 PM , Rating: 2
If these allegations are indeed true then Intel deserves to get nailed. Nothing worse than a monopoly for the consumer and any company that engages in unethical business practices, such as those mentioned, deserves a good smackdown and then some.




Fine is excessive
By jdietz on 12/16/2009 2:56:51 PM , Rating: 2
1.45B...
~25% of Intel 2008 net income...
Does that seem excessive to you? Only 20% of the company's income comes from the United States. FTC is authorized to collect on behalf of US consumers only.

I think FTC is issuing this fine for multiple years of violations rather than just one.




Selective Memory
By stngo1 on 12/16/2009 5:25:28 PM , Rating: 2
I read this as the FTC saying that Intel has an obligation to ensure that its compilers are optimized for both Intel and AMD CPUs. That is ridiculous. Also, I guess a lot of people seemed to have forgotten versions of compilers where AMD CPUs ran faster on the Intel compiler than their own version http://www.tomshardware.com/forum/59426-28-intel-c... (as well as other results on Google).

Also, it's amazing how a lot of people have forgotten how AMD has fallen short when they've tried to increase their market share by short changing the end customers in their "Channel Market" - a Google search on AMD CPU Shortage resulted in over 22,000 results http://www.google.com/search?hl=en&num=100&newwind... Many people came to these same forums to complain about how they couldn't get any good AMD CPUs since a lot of the allocations went to DELL first to fulfill a contractual comittment.

As for the rebates and charges of monopoly, how is that different than getting a factory and/or customer loyalty rebate from Ford, GM, Toyota when you buy their vehicles or mail in rebate from ASUS or Gigabyte when purchasing their motherboards or video cards? The only thing is that the Intel rebates happen at a higher level in the supply chain and in a lump sum instead to individual end users. Intel is actually doing consumers a favor by not making them submit rebates. Intel could sell CPUs to DELL, HP, etc. at higher prices and then let the "Dude I bought a DELL" end customers to send in customer rebate vouchers. I might suggest that to Intel management as they would save money since statistics show that over 90% of people never or improperly submit their rebates.




The software part is BS
By toyotabedzrock on 12/16/2009 5:32:33 PM , Rating: 2
AMD makes it's own compiler and libraries too. Also i have heard that most programs run faster on AMD chips when the Intel compiler is used, compared to MSVC, provided you don't tell it to use something like sse4.2




Correction
By Reclaimer77 on 12/16/09, Rating: -1
RE: Correction
By Connoisseur on 12/16/2009 11:57:07 AM , Rating: 5
So... you're okay with a company allegedly maintaining a monopoly by stifling competition via illegal practices? Because monopoly is ALWAYS great for the consumer...

Keep in mind many of these litigations (at least the EU investigation) don't necessary focus on their CURRENT products but Intel's behavior in the last 10 years or so. This covers several generations of both AMD and Intel products, not just current Core and Athlon X2 technologies. I'm obviously not privy to what time frames the alleged "software fixing" occurred, but I can imagine that it covers similar periods.


RE: Correction
By Reclaimer77 on 12/16/09, Rating: -1
RE: Correction
By spread on 12/16/09, Rating: 0
RE: Correction
By MrBlastman on 12/16/2009 12:40:46 PM , Rating: 1
I didn't start the fire, you just asked me to fuel it...

quote:
I am a Business Finance major in College


Get your behind out of the halls of academia and take off your funky glasses and try earning a living every day of the week before you start bashing Fox News and making them out to be worse than any of the other networks out there. Truth: They aren't, they're all crummy and at least Fox balances out the rest of the leftist-extremist stations.

Get a clue.

The world actually turns outside of college but since you are busy majoring in university you obviously have not been met with the challenge of feeding your family and worrying about where your next paycheck is coming from.

Where on earth did his post mention Fox News? It didn't. You DID. Stop believing everything you read or hear in your fantasy world and try the real world on for size for a change.


RE: Correction
By oxymojoe on 12/16/2009 1:12:23 PM , Rating: 3
What channel do you turn on if your "conservative" or just sick of mega distortions? On every Fox show they have at least one Democrat throwing out their POV. Why is Fox No.1 in cable news? They blow CNN, CNBC, and MSNBC ratings out of the water. Its probably because what is being said resonates and has truth to it. Some spin, but still the 411 on what's really going on.

If Glenn Beck, Rush Limbaugh, and Bill O'Rilley are just spewing "hate speech", then what is Rachel Maddow, Cris Matthews, and Keith Olbermann doing?

Oh that's right, they are hard hitting journalists...leg tingle and all.


RE: Correction
By kaoken on 12/16/2009 3:35:11 PM , Rating: 2
"Why is Fox No.1 in cable news? They blow CNN, CNBC, and MSNBC ratings out of the water."

Because fox news are comprised of trolls like Glen Beck and Rush Limp. Watch some daily show.


RE: Correction
By knutjb on 12/16/2009 4:48:18 PM , Rating: 2
Never thought of Glen Beck and Rush Limbaugh as trolls. Maybe you need to come up for air.

What daily show do you suggest?

BTW this case has nothing to do with Obama or Bush. This is a very complex case of Intel trying to stretch the laws but crossing the line into criminal activities.


RE: Correction
By jconan on 12/16/2009 10:03:03 PM , Rating: 2
America lacks a technocratic party. There should be a new party for tech enthusiast that bulldozes away the liberal and conservative issues for technological issues. Bill Gates or Steve Jobs???


RE: Correction
By spread on 12/16/2009 3:27:46 PM , Rating: 1
What makes you think I'm not earning a living to pay for my studies? I wasn't born with a silver spoon in my mouth like a yuppie.

So I guess that makes me qualified to discuss macro-economics with you now. Tell me more about these anti-business tactics that the Obama administration instigated years ago. Before they existed. I'm waiting patiently.


RE: Correction
By MrBlastman on 12/16/2009 4:47:25 PM , Rating: 1
Paying for studies and feeding a family are two completely different things. The level of stress is a million times greater. College is fantasy land and no amount of macro-economics book-background from school will compare to a few years of real world experience once you graduate. ;)

Trust me, I've been there.


RE: Correction
By knutjb on 12/16/2009 4:55:00 PM , Rating: 2
Agree, that little piece of very expensive paper is treated as more important than real experience. I am feeding a family while working to get that little piece of paper. Most of what I hear isn't from the real world and I have to work hard to tell them what they want to hear not what my experience knows to be correct. I hope the pendulum swings back soon.


RE: Correction
By MrBlastman on 12/16/2009 5:16:03 PM , Rating: 2
The little piece of paper opens doors for sure.

I wouldn't have had the opportunites I have without it. But, it stopped there. Everything since that sheet of paper has built upon what I learned and then far more than that. I suppose I was fortunate in that my professors back in the day all were required to have had successful careers outside of college prior to being hired to teach, as unfortunately most of the time you run into professors who could not make it outside of academia so they were forced to teach based on books rather than experiences.

I have no point to add to this argument other than that. :)

I'm happy Intel has been smitten by the government finally--if indeed they _were_ forcing their compilers to screw over non-intel processors with crummy optimizations, that is quite rotten and they should face some judicial scrutiny for it. However, those developers who were not trying to optimize their code further by using multiple compilers are also partially to blame.


RE: Correction
By mcnabney on 12/16/2009 12:20:57 PM , Rating: 3
Bailing out Wall Street. Definitely anti-business.

Go back to watching Fox News and let the adults continue our conversation.


RE: Correction
By Connoisseur on 12/16/2009 12:26:59 PM , Rating: 2
So you're providing a political comment completely un-related to the main point of the article? To me, it appeared that you were commenting on how the FTC filing an anti-trust suit is "anti-business". Instead it was just an Obama administration bash. Fair enough.

Ignoring the political commentary, your other comments are NOT a moot point. As I mentioned, many of these litigations focus on practices in the last 10 or so years. Who's to say that, in a fair market environment, demand for other competitor's products wouldn't have gone up? Thus, profits would go up and they would have invested more in manufacturing capacity to be further competitive/meet demand. From what i've seen, estimating damages is more of an art rather than a science. It involves a lot of charts, graphs and regression analysis. Granted, i'm no expert in anti-trust cases but I can assume damages will be calculated based on what COULD have been rather than what IS at the present.

Finally, I have no idea why you're linking certain people on this thread to fanboyism. If Intel is shown to have broken FTC rules and regs, then they acted illegally and should be accordingly penalized. Fanboyism has nothing to do with it. Enjoy your Core 2 Duo. Who's to say that these alleged practices didn't stifle AMD (or any other competitors therein) from investing additional R&D to develop an even better chip?


RE: Correction
By Bateluer on 12/16/2009 12:33:37 PM , Rating: 2
You do realize that the ONLY reason you actually have that C2D is because of AMD and the Athlon 64, and A64 X2 lines right? If it hadn't been for AMD, you'd be cruising in a 65nm P4 design right now, likely a single core design.


RE: Correction
By Proteusza on 12/16/2009 11:59:30 AM , Rating: 2
I wondered how long it would take.

Cos, clearly, if the FTC regulates businesses, it must be commie. Right?

I wonder how many people really know what socialism/communism is.


RE: Correction
By docawolff on 12/16/2009 12:03:38 PM , Rating: 2
Oh wow! It is "anti-business" to produce a fair and level playing field? It is, by that argument, "pro-business" to let one company dominate the market, not through better technology, but through bribes, threats, and anti-competitive code?

Are you nuts?


RE: Correction
By oxymojoe on 12/16/2009 12:09:28 PM , Rating: 1
It is well known our current administration has stifled small business growth and expanded the role of government in every facet of our lives. There is a big public image problem with Obama and this does help to strengthen his position he's for "the little guy".

Can you tell me how Microsoft has a fair and level playing field? How Wal-mart has a fair and level playing field?

This is smoke and mirrors.


RE: Correction
By mcnabney on 12/16/2009 12:21:59 PM , Rating: 2
[citation needed]


RE: Correction
By oxymojoe on 12/16/2009 12:45:11 PM , Rating: 2
Less than one half of 1% of the so called stimulus package was small business tax cuts. 82.9% of all jobs come from small business per Business Week. Anyone with their own business (such as several of my friends and myself) knows what Obama has done up to date. Nothing.

He wants people reliant on government for everything. You know who's seen job growth and pay increases? Government jobs.

Do your own research and get your own citations DB..I'm not some schoolboy and you dang sure aren't a teacher.


RE: Correction
By zsdersw on 12/16/2009 12:14:11 PM , Rating: 1
I don't know if he's nuts, but you clearly are. Your comment is nothing more than a field of strawmen.


Kill the patents...
By eek2121 on 12/16/09, Rating: -1
RE: Kill the patents...
By Reclaimer77 on 12/16/09, Rating: -1
RE: Kill the patents...
By eek2121 on 12/16/09, Rating: 0
RE: Kill the patents...
By zsdersw on 12/16/2009 12:03:59 PM , Rating: 4
No, you are an idiot, actually. Having an abusive monopoly doesn't mean their patents are up for revokation.


RE: Kill the patents...
By mcnabney on 12/16/09, Rating: -1
RE: Kill the patents...
By weskurtz0081 on 12/16/2009 12:54:37 PM , Rating: 3
I keep seeing the word "Monopoly" getting thrown around here, but I have yet to see anyone prove that Intel is, by definition, a Monopoly.


RE: Kill the patents...
By Motoman on 12/16/2009 12:59:47 PM , Rating: 2
That's because they categorically are not a monopoly.

People here on DT regularly display a total misunderstanding of what a monopoly is. Having a majority marketshare, even if it was 99%, does not make you a monopoly...granted that there are other reasonable alternatives for your product that are easily accessible.

Like AMD, Nvidia, Via, blah blah blah. There is nothing that Intel makes that the industry can't do without - someone else is making an equivalent product elsewhere that is immediately accessible and does the same thing.


RE: Kill the patents...
By mcnabney on 12/16/2009 1:43:21 PM , Rating: 2
From the almighty Wiki:

quote:
In economics, a monopoly (from Greek monos / ยต???? (alone or single) + polein / p??e?? (to sell)) exists when a specific individual or an enterprise has sufficient control over a particular product or service to determine significantly the terms on which other individuals shall have access to it


Sounds like Intel to me. And the FTC suite is all about controlling access and product control.


RE: Kill the patents...
By weskurtz0081 on 12/16/2009 1:56:16 PM , Rating: 2
Wow, pretty selective reading you did there.


RE: Kill the patents...
By weskurtz0081 on 12/16/2009 1:59:02 PM , Rating: 2
Just so you understand what I meant when I mentioned selective reading.

quote:
Monopolies are thus characterized by a lack of economic competition for the good or service that they provide and a lack of viable substitute goods.


Seems to me that Intel has competition, there are substitute goods being offered.

So, which is it?


RE: Kill the patents...
By Motoman on 12/16/2009 3:02:41 PM , Rating: 2
Yours is much more like what you'd get from an economist, or industry regulator. A fundamental lack of a reasonable alternative is needed to create a monopoly.

This is the reason, for example, why iTunes can never be a monopoly. Regardless of what their marketshare grows to, as long as *somebody* else is selling .mp3s on the internet, no monopoly is possible.


RE: Kill the patents...
By Ard on 12/16/2009 8:56:17 PM , Rating: 2
Intel isn't a monopoly by any stretch of the imagination. They exist in a duopoly with AMD.


RE: Kill the patents...
By Motoman on 12/18/2009 10:25:03 AM , Rating: 2
That is a true statement. I think the only other option at all now is Via, and they are effectively a non-participant these days.


RE: Kill the patents...
By oxymojoe on 12/16/2009 12:54:54 PM , Rating: 3
You defy all logic and reason.


RE: Kill the patents...
By Motoman on 12/16/2009 1:02:38 PM , Rating: 3
Here's a fun little experiment:

Can you describe what a monopoly is?


RE: Kill the patents...
By docawolff on 12/16/2009 12:08:49 PM , Rating: 3
There is no law, nor even a moral argument that says Intel should license its patents. They are an asset of the company just as much as the fab or the CEO's office furniture. They COULD license them, but they chose not to do so. That was their business decision, and it was righteous. What was unrighteous was their bribes and threats to keep the competition out. Nothing to do with their Intellectual Property.


RE: Kill the patents...
By weskurtz0081 on 12/16/2009 12:08:58 PM , Rating: 1
Intel isn't a monopoly by the definition. Via and AMD also make X86 CPU's. And, if you have the cash you can too! I hate on Intel as much as the next guy, but don't call a company a monopoly when they aren't, you open yourself up when you make false claims.


RE: Kill the patents...
By mcnabney on 12/16/2009 12:26:22 PM , Rating: 2
No you can't. Intel, VIA, and AMD are the only companies on the planet that can legally make X86 chips. This came up recently with Nvidia and how many people suggested they add X86 support to their GPUs. They can't . Not unless they buy VIA.


RE: Kill the patents...
By weskurtz0081 on 12/16/2009 12:44:25 PM , Rating: 2
Sure they can, they just have to license the technology from Intel. Anyone with enough money, whatever Intel asks for the licensing agreement, will be able to make the chips.


RE: Kill the patents...
By mcnabney on 12/16/2009 1:40:07 PM , Rating: 2
Intel has never licensed X86. The existing licences (now held by AMD and VIA) were instituted before Intel bought full control of X86. In fact, Intel just dropped their suit against AMD that was attempting to terminate their license. Claiming that a monopolist could take actions to decrease their monopoly does not mitigate the fact that they are a monopolist.


RE: Kill the patents...
By weskurtz0081 on 12/16/2009 1:52:42 PM , Rating: 2
Intel has never licensed X86.... so? Doesn't mean they wouldn't if you have the right amount of money.... everything has a price.

Explain to me how Intel is a "monopolist", whatever that is.

You really don't understand what I am arguing against do you?


RE: Kill the patents...
By Motoman on 12/16/2009 3:08:36 PM , Rating: 2
quote:
You really don't understand what I am arguing against do you?


...no, he doesn't. So stop feeding the troll. Please.


RE: Kill the patents...
By SPOOFE on 12/16/2009 3:46:09 PM , Rating: 2
quote:
Doesn't mean they wouldn't if you have the right amount of money.... everything has a price.

Using price to make access practically impossible is also an abuse of market power.


RE: Kill the patents...
By jconan on 12/16/2009 9:58:35 PM , Rating: 2
that's the same tactic used by Apple, ATT and others to sue manufacturers of LCD and memory for price fixing. Except in this case Intel does this itself


RE: Kill the patents...
By weskurtz0081 on 12/16/2009 12:52:15 PM , Rating: 2
No reason to down rate me here, nothing I said above is false. If you have ENOUGH money, whatever Intel asks for a licensing agreement, or a cross licensing agreement (depending on what cards you are holding), Intel would be willing to sell the licensing to allow you to make X86 CPU's. It might be prohibitively expensive, but it doesn't make what I said false.


RE: Kill the patents...
By Fritzr on 12/16/2009 10:47:06 PM , Rating: 2
If the price is prohibitive then by definition the license is prohibited.

If the cost of R&D+production+license exceeds what the market will pay then their is no product. Standard Oil was declared a monopoly and broken up for similar reasons. Standard HAD viable competition. Standard used their majority supplier status to wipe out their smaller competitors. Due to their size and ability to sell at a loss in selected markets they had a monopoly in spite of the existence of competitors who would have been viable in the absence of anti-competition actions taken by Standard Oil.

Intel today is in a similar position. They own the rights to the IAS (x86 instruction set) and get to decide who can build chips using the Intel designs. Theoretically a startup company can blackbox a new design that reacts in exactly the same manner as Intel's designs to the x86 hexcode, but that is a major expense that has to be financed in addition to designing a chip architecture that executes x86 code as efficiently as the Intel chips that will be on the market at the same time.

Currently as noted in the article AMD is a competitor in the sub $200 market. For the high performance chips Intel is the clear choice and this technical advantage gives them a monopoly in the above $200 market. Add aggressive marketing tactics that are intended, as much as possible, to prevent customers from choosing non-Intel options and you have a monopoly business actively preventing its competitors from entering the market and weakening Intel's ability to decide what will be sold.

Competitors are viable only if they are permitted to enter the market. Make the cost of entry to high to be financially viable and you will have no new companies entering the market. As long as the IAS patents continue to be held by Intel, Intel will be able to say who is or is not allowed to enter the x86 market. Until the effective monopoly OS supports non-x86 instruction sets Intel will continue to dominate the micro-computer CPU market.

Without the income generated by mainstream consumer sales the non-x86 chips will be minor players in the markets where they can compete, such as mainframes & supercomputers based on micro-computer CPUs.

This form of effective monopoly is one of the consequences of the Capitalist system. You can either accept the existence of monopolies along with the problems they can bring or you allow the government to be a little bit anti-Capitalist and have it force the monopoly to allow the competition to be viable competition, thereby forcing innovation by the monopolist to regain monopoly status.


RE: Kill the patents...
By weskurtz0081 on 12/17/2009 12:18:08 AM , Rating: 2
My only point is, Intel is NOT a monopoly. I am sure they have violated some of the Anti trust laws, but that doesn't mean they are a monopoly. People keep calling Intel a monopoly, my point is, they are not.

On the other hand, they have likely violated anti trust laws, they have probably been behaving in an anti competitive manner, and they deserve to suffer the consequences. That is my point.

Also, I want to point out, Intel might hold a monopoly in the higher end desktop chips, but not in the enterprise space.


RE: Kill the patents...
By Fritzr on 12/17/2009 9:52:21 PM , Rating: 2
If you are talking to a lawyer then the word is "trust". That refers to a company or consortium that has the power to dictate pricing, availability and permission to market.

In practical terms a trust has monopoly power and uses that power to prevent others from joining the market. In common street parlance a trust under the Sherman Anti-Trust Act and similar legislation is referred to as a monopoly.

True, Webster's dictionary and the Oxford English Dictionary define a monopoly as the complete absence of competition, however the government does regulate effective monopolies through the Anti-Trust legislation and when not reading the text of the legislation commonly refers to these companies as monopolies or wielding monopoly power.

I am surprised that you ended your last comment by stating your position in the terms that I have just stated by saying that in high end chips...
quote:
Also, I want to point out, Intel might hold a monopoly in the higher end desktop chips, but not in the enterprise space.
Intel has competition in the high end desktop, though the percentage is low. By your stated definition Intel does not have a monopoly in that category, they only have most of the market not all of it. The price points do allow some sales to go to the slightly less efficient high end offerings of AMD.


RE: Kill the patents...
By weskurtz0081 on 12/17/2009 10:22:04 PM , Rating: 2
Yeah, probably shouldn't have used the word monopoly, it wasn't appropriate, I was just typing away and busy working and trying to respond.

I am referring to a monopoly in the terms of economics. And, according to economics, Intel DOES have monopoly power, but it doesn't make them a monopoly.

Regardless of who I am talking to, Intel isn't a monopoly by definition, it just isn't.

It doesn't mean they cannot harm competitors or make market entrance difficult, because they likely have been doing both, but there is not an absence of competition.

Intel does not have a monopoly in high end desktop chips, I was thinking more in the terms of performance when I wrote that, and thinking of performance only, they have no competition. No other company makes a CPU that is as fast as Intel in the high end desktop arena. But, it doesn't mean they have a monopoly, I simple mispoke, used the wrong terminology, what have you.


RE: Kill the patents...
By weskurtz0081 on 12/17/2009 10:22:05 PM , Rating: 2
Yeah, probably shouldn't have used the word monopoly, it wasn't appropriate, I was just typing away and busy working and trying to respond.

I am referring to a monopoly in the terms of economics. And, according to economics, Intel DOES have monopoly power, but it doesn't make them a monopoly.

Regardless of who I am talking to, Intel isn't a monopoly by definition, it just isn't.

It doesn't mean they cannot harm competitors or make market entrance difficult, because they likely have been doing both, but there is not an absence of competition.

Intel does not have a monopoly in high end desktop chips, I was thinking more in the terms of performance when I wrote that, and thinking of performance only, they have no competition. No other company makes a CPU that is as fast as Intel in the high end desktop arena. But, it doesn't mean they have a monopoly, I simple mispoke, used the wrong terminology, what have you.


RE: Kill the patents...
By killerroach on 12/16/2009 12:54:24 PM , Rating: 3
In terms of antitrust litigation you do not have to have a de facto monopoly, but rather enough market share to be able to negatively influence the normal business operations of your competitors. Depending on the industry, an antitrust lawsuit could be successfully argued against a company who didn't even have a majority of market share in their industry, but were able to, thanks to either collusion or advantageous vertical positioning, exert a stranglehold over competitive activity...


RE: Kill the patents...
By weskurtz0081 on 12/16/2009 12:59:43 PM , Rating: 3
Of course, that is absolutely true, I am just arguing against people who are using the terms incorrectly.

Intel is not a monopoly. They do have monopolistic power, but they are not a true monopoly. That's all I am saying.

The company though, is powerful enough to affect smaller players in the market in a negative way, which the company apparently did, but that doesn't make them a monopoly. They probably did violate antitrust law (Sherman/Clayton), but that doesn't require you to be a monopoly in the true sense of the word.


RE: Kill the patents...
By Motoman on 12/16/2009 1:25:56 PM , Rating: 2
You don't have to have a majority marketshare, or even a significant marketshare, to engage in antitrust activities.

If you have 1% of the market, and offer a customer cash on the side to NOT use a product from one of your competitors, you have just committed an antitrust offense.


RE: Kill the patents...
By dsx724 on 12/16/2009 12:02:05 PM , Rating: 2
Lets not forget the millions of developers who spent time making x86 what it is. Without them Intel has a microprocessor no one wants.


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