Feds kills ATI and Nvidia price-fix probe
Dropped like a hot chip
The US Department of Justice has dropped its two-year investigation of Nvidia and ATI over suspicions the companies conspired to fix graphics chip prices.
Both chip makers said they received letters from the DoJ indicating the probe formally concluded with no action taken.
Although little was known about specifics of the investigation, in December 2006, the companies confirmed receipt of subpoenas by the agency. The DoJ simply stated it was looking into: "The possibility of anticompetitive practices involving the graphics processing units and cards industry."
ATI and Nvidia eagerly note that no specific allegations were made against them during investigation.
No such vagueness was tossed about in a separate private antitrust suit filed against the chip makers in Northern California District Court. Court filings allege the companies: "Conducted numerous secret meetings and communications in which they conspired to fix, raise, maintain and stabilize prices of GPUs sold in the United States."
Both companies denied the accusations, but agreed to an out-of-court settlement in exchange for all claims being dismissed. Each agreed to pay $850,000 as a part of the deal announced in September.®
original class action plaintiffs only
Only the handful of straw men consumers and the lawyers you started it get the 850k, (looks like AMD may not have paid the settlement). It seems like class-action lawsuits occasionally give tiny handouts to all affected, but mostly just make a litigious few richer.
Is it just me or is this entirley wrong and tantamount to bribery.
U.S Gvmnt Legal Eagle: Hmm it appears to me that you have been artificially inflating you prices for shareholder gains.
Nvidia/Ati: No we haven't why we do shuch an underhand thing.
U.S Gvmnt Legal Eagle: Well on paper this all looks a bit shady.
Nvidia/Ati: But we've done nothing wrong, look, heres a hefty sum of cash we had floating around that proves it.
U.S Gvmnt Legal Eagle: Well it would appear you were right all along..... carry on.
Mines the one with unnusually large "slush-fund" in the pocket.
$1.7M to the FBI to pay for the investigation (lots of overtime, donuts etc.)
Virgin, BA et. al price fixed and left an audit trail. These "high tech" companies may have known better - just met in a Starbucks and agreed to fix prices.
Why is it so hard to enter this market - where are the Chinese / Indians when you need them ?
Well, NVidia and ATI really don't have much competition* so I could see the DOJ looking into it. But, I think DOJ dropped it because they didn't have a case. ATI & Nvidia do have a natural duopoly right now simply because it's so expensive to get into the serious GPU-making business, If anything it seems like ATI and NVidia are in a massive price war, cranking out new modelss and dropping the old ones so fast to sub-$100 prices so fast.
*Competition: As far as I know, there's Intel's onboard, Via's onboard (which is more or less S3 Unichrome + extra MPEG-2 or H.264 decoding.. so not usable for 3D but nice for video playback). Matrox makes video cards for like medical, financial, and video wall use.. they basically specialize in multihead, the 4-head card with 3x splitters gets you a 12-head setup at 1280x1024 per head. What else is there for desktops right now? I haven't heard from XGI in a while (they were spun off of SiS's graphics division).
Where's the money?
Who got that $1.7M?