FTC, Intel Reach Settlement; Intel Banned From Anticompetitive Practices
August 4, 2010 1:45 PM
comment(s) - last by
The FTC has banned Intel from paying off OEMs to exclusively carry its products or to NOT carry AMD products.
(Source: The New York Times)
Settlement also establishes $10M USD fund that could help OEMs switch to AMD or NVIDIA
Intel, like Microsoft, built a seemingly ironclad lead through a combination of great products and aggressive business maneuvering. Those maneuvers could be viewed as clever moves or destructive anticompetitive behavior -- it all depends on who you ask. However, in recent years Intel, like Microsoft, has come under increasing pressure to stop its more "creative" business tactics. Fined
$1.45B USD by the European Union
last year, Intel has just arrived at
with the U.S. Federal Trade Commission over numerous antitrust issues.
While the settlement is less painful fiscally than the EU ruling, it will have a major impact on the way Intel conducts its business. Intel is no longer allowed to pay off (either directly, or through unit discounts) OEMs to exclusively carry Intel CPUs or to not carry competitor Advanced Micro Devices' CPUs. Likewise, it can no longer retaliate against OEMs who opt to offer competitive products.
Intel is also banned from specifically redesigning its chips to harm its competitors. Specifically it will be forced to not limit the performance of rivals' GPU chips for at least the next six years. Also, it must publish clearly that its compiler discriminates against non-Intel processors (such as AMD's designs), not fully utilizing their features and producing inferior code.
The settlement concludes a suit
launched by the FTC
in December following an investigation. While it brings no major fines against Intel, it does require Intel to pay $10M USD to establish a fund to help business customers retool their software if they were misled by Intel to think the poor performance of Intel-compiled code on AMD chips was normal.
Intel’s general counsel, A. Douglas Melamed
, "[This settlement will] put an end to the expense and distraction of the FTC litigation. This agreement provides a framework that will allow us to continue to compete and to provide our customers the best possible products at the best prices."
The settlement removes a critical piece of the remaining U.S. litigation on Intel's plate. Previously, Intel had agreed to a
$1.25B USD payout
to settle a civil case with AMD last November. The only major remaining legal action against it now is a lawsuit from the state of New York, alleging illegal anticompetitive behavior.
While the antitrust litigation of the turn of the millenia did not derail Microsoft or significantly alter its PC operating system market share, the latest round -- this time against Intel -- could have a more serious impact. Unlike Microsoft, Intel has a very aggressive rival in its core business -- AMD. Last year AMD's CPU shipments
grew 17.7 percent
on a year-to-year basis, giving it a 19.4 percent market share. Intel, meanwhile, saw its lead shrink, posting an 80.5 percent market share.
From 2003 to 2006 AMD produced CPUs that were widely considered to outperform similarly priced Intel designs. While other issues also hampered AMD, it alleges that it largely failed to gain market share during this era thanks to Intel's questionable business practices -- and legal settlements seem to back up this claim.
revitalized once more
taken the discrete graphics sales crown
from NVIDIA, thanks to its head start with DirectX 11 GPUs. If it can duplicate this success on the CPU market, this time it may finally be able to see its hard work pay off with increased OEM adoption -- now that Intel can no longer pay off OEMs not to use its products. The ball is in AMD's court, as they say.
This article is over a month old, voting and posting comments is disabled
Still no NVidia Chipsets
8/4/2010 4:02:53 PM
The one thing that I was looking forward to from a possible settlement, Intel to re-establish a license agreement with NVidia to resume producing chipsets for Intel's desktop and Server CPU's, didn't come to reality. I really liked NVidia chipsets (esp the early ones that included soundstorm) despite NV's occasional screw-ups and their poor reputation. The outcome of this settlement really makes me sad =(.
"Paying an extra $500 for a computer in this environment -- same piece of hardware -- paying $500 more to get a logo on it? I think that's a more challenging proposition for the average person than it used to be." -- Steve Ballmer
AMD Takes Discrete Graphics Market Lead from NVIDIA
July 30, 2010, 9:17 AM
AMD Almost Out of the Money Hole, Beats Estimates by $110M USD
July 16, 2010, 8:45 AM
U.S. FTC Slams Intel With Antitrust Suit
December 16, 2009, 11:40 AM
Intel, AMD Settle Antitrust Disputes, Intel to Pay AMD $1.25 Billion
November 12, 2009, 9:34 AM
European Commission Fines Intel $1.45B
May 13, 2009, 9:04 AM
"Prepare to be Punished": Microsoft is Killing OneDrive With Cuts, Blames Users
November 3, 2015, 8:23 PM
Apple's New "Magic" Peripheral Line Packs High Tech, High Prices
October 13, 2015, 9:39 PM
Samsung Adds 2 TB 850 EVO, PRO SSDs for $800, $1000
July 7, 2015, 4:23 PM
Seagate Senior Researcher: Heat Can Kill Data on Stored SSDs
May 13, 2015, 2:49 PM
How to Recover Most Apps After Your NVIDIA Driver Crashes in Windows 10
March 30, 2015, 12:54 PM
Tinkerer Gets Old School Mac Plus Running on the Modern Web
March 24, 2015, 6:41 PM
Most Popular Articles
Top 5 Smart Watches
July 21, 2016, 11:48 PM
Free Windows 10 offer ends July 29th, 2016: 10 Reasons to Upgrade Immediately
July 22, 2016, 9:19 PM
Latest Blog Posts
Sceptre Airs 27", 120 Hz. 1080p Monitor/HDTV w/ 5 ms Response Time for $220
Dec 3, 2014, 10:32 PM
Costco Gives Employees Thanksgiving Off; Wal-Mart Leads "Black Thursday" Charge
Oct 29, 2014, 9:57 PM
"Bear Selfies" Fad Could Turn Deadly, Warn Nevada Wildlife Officials
Oct 28, 2014, 12:00 PM
The Surface Mini That Was Never Released Gets "Hands On" Treatment
Sep 26, 2014, 8:22 AM
ISIS Imposes Ban on Teaching Evolution in Iraq
Sep 17, 2014, 5:22 PM
More Blog Posts
Copyright 2016 DailyTech LLC. -
Terms, Conditions & Privacy Information