Friday, January 28, 2011
Monday, March 15, 2010
Intel Anti-competitive allegations by regulatory bodies
In 2005, the local Fair Trade Commission found that Intel violated the Japanese Antimonopoly Act. The commission ordered Intel to eliminate discounts that had discriminated against AMD. To avoid a trial, Intel agreed to comply with the order
European Union
In July 2007, the European Commission accused Intel of anti-competitive practices, mostly against AMD.[88] The allegations, going back to 2003, include giving preferential prices to computer makers buying most or all of their chips from Intel, paying computer makers to delay or cancel the launch of products using AMD chips, and providing chips at below standard cost to governments and educational institutions.[89] Intel responded that the allegations were unfounded and instead qualified its market behavior as consumer-friendly.[90] General counsel Bruce Sewell responded that the Commission had misunderstood some factual assumptions as to pricing and manufacturing costs.[91]
In February 2008, Intel stated that its office in Munich had been raided by European Union regulators. Intel reported that it was cooperating with investigators.[92] Intel faced a fine of up to 10% of its annual revenue, if found guilty of stifling competition.[90] AMD subsequently launched a website promoting these allegations.[93][94] In June 2008, the EU filed new charges against Intel.[95] In May 2009, the EU found that Intel had engaged in anti-competitive practices and subsequently fined Intel €1.06 billion ($1.44 billion), a record amount. Intel was found to have paid companies, including Acer, Dell, HP, Lenovo and NEC,[96] to exclusively use Intel chips in their products, and therefore harmed other companies including AMD.[96][97][98] The European Commission said that Intel had deliberately acted to keep competitors out of the computer chip market and in doing so had made a "serious and sustained violation of the EU's antitrust rules".[96] In addition to the fine, Intel was ordered by the Commission to immediately cease all illegal practices.[96] Intel has stated that they will appeal against the Commission's verdict
South Korea
In September 2007, South Korean regulators accused Intel of breaking antitrust law. The investigation began in February 2006, when officials raided Intel's South Korean offices. The company risked a penalty of up to 3% of its annual sales, if found guilty.[99] In June 2008, the Fair Trade Commission ordered Intel to pay a fine of $25.5 million for taking advantage of its dominant position to offer incentives to major Korean PC manufacturers on the condition of not buying products from AMD
United States
New York started an investigation of Intel in January 2008 on whether the company violated antitrust laws in pricing and sales of its microprocessors.[101] In June 2008, the Federal Trade Commission also began an antitrust investigation of the case.[102] In December 2009 the FTC announced it would initiate an administrative proceeding against Intel in September 2010.[103][104][105][106]
In November 2009, following a two year investigation, New York Attorney General Andrew Cuomo sued Intel, accusing them of bribery and coercion, claiming that Intel bribed computer makers to buy more of their chips than those of their rivals, and threatened to withdraw these payments if the computer makers were perceived as working too closely with its competitors. Intel has denied these claims.
Intel Lawsuits
In September 2005, Intel filed a response to an AMD lawsuit,[74] disputing AMD's claims, and claiming that Intel's business practices are fair and lawful. In a rebuttal, Intel deconstructed AMD's offensive strategy and argued that AMD struggled largely as a result of its own bad business decisions, including underinvestment in essential manufacturing capacity and excessive reliance on contracting out chip foundries.[75] Legal analysts predict the lawsuit will most drag for a number of years, since Intel's response indicates that Intel is not likely to settle the dispute with AMD.[76][77] A court date has been granted in 2010.[78]
In October 2006, a Transmeta lawsuit was filed against Intel for patent infringement on computer architecture and power efficiency technologies.[79] The lawsuit was settled in October 2007, with Intel agreeing to pay USD 150 million initially and USD 20 million per year for the next five years. Both companies agreed to drop lawsuits against each other, while Intel was granted a perpetual non-exclusive license to use current and future patented Transmeta technologies in its chips for 10 years.[80]
On November 4, 2009, New York's attorney general filed an antitrust lawsuit against Intel Corp, claiming the company used "illegal threats and collusion" to dominate the market for computer microprocessors.
On November 12, 2009, Intel and AMD announced a truce for 5 years by Intel paying AMD $1.25 billion in exchange for it to drop the antitrust suit AMD brought against Intel five years ago[81]. In a joint statement, the two chip makers said this, "While the relationship between the two companies has been difficult in the past, this agreement ends the legal disputes and enables the companies to focus all of our efforts on product innovation and development."
Intel Competition
Competitors in PC chip sets include VIA Technologies, SiS, and Nvidia. Intel's competitors in networking include Freescale, Infineon, Broadcom, Marvell Technology Group and AMCC, and competitors in flash memory include Spansion, Samsung, Qimonda, Toshiba, STMicroelectronics, and Hynix.
The only major competitor in the x86 processor market is Advanced Micro Devices (AMD), with which Intel has had full cross-licensing agreements since 1976: each partner can use the other's patented technological innovations without charge after a certain time.[72] However, the cross-licensing agreement is canceled in the event of an AMD bankruptcy or takeover.[73] Some smaller competitors such as VIA and Transmeta produce low-power x86 processors for small factor computers and portable equipment.
Intel Age discrimination
A group called FACE Intel (Former and Current Employees of Intel) claims that Intel weeds out older employees. FACE Intel claims that more than 90 percent of people who have been terminated by Intel are over the age of 40. Upside magazine requested data from Intel breaking out its hiring and terminations by age, but the company declined to provide any.[69] Intel has denied that age plays any role in Intel's employment practices.[70] FACE Intel was founded by Ken Hamidi, who was terminated by Intel in 1995 at the age of 47.[69] Hamidi was blocked in a 1999 court decision from using Intel's email system to distribute criticism of the company to employees
