Intel hit with largest ever EU fine
Millions harmed by chip giant's behaviour
The European Commission has found Intel guilty of anti-competitive behaviour and fined it over a billion euros.
The Commission has ordered the chip giant to refrain from any equivalent practises in the future. It ruled the firm damaged competition by excluding rival AMD from markets.
Competition Commissioner Neelie Kroes said the threat of AMD was widely recognised in internal Intel documents seen by the Commission.
She said Intel's rebates were a problem because of the conditions attached. She questioned whether an efficient competitor could offer such rebates. The conditions meant AMD could not compete with Intel on the merits of its products.
This undermined innovation - one PC manufacturer took up some free AMD processors but not all of those offered, because if it had done it would have breached its agreement with Intel. It was offered a million free AMD chips, but only accepted 160,000 so it would keep its Intel rebates.
Kroes said the Commission supported price competition but Intel's actions went far beyond that.
Intel paid retailer Media Saturn Holding on condition it only stocked machines with Intel chips. The company also made direct payments to computer makers to delay and limit release of machines with AMD inside.
Three computer makers were given rebates provided they sourced a set percentage of their chips from Intel. A fourth pledged to source all its laptop chips from Intel in exchange for rebates.
"Pay to delay" was aimed at stopping a competitor from selling its products to consumers.
The Commission found evidence that Intel went to great lengths to cover up these actions. Many of the agreements were made outside of official contracts.
Kroes said Intel had harmed millions and millions of European consumers, so the size of the fine should come as no surprise. She thanked European consumer associations for their support.
She said: "This goes to show the widespread dissatisfaction with Intel's action. I'd like to draw your attention to Intel's latest advert calling them sponsors of tomorrow, now they are sponsors of the European taxpayer." She told Intel to obey the law.
Kroes said the Commission could have raised the fine but it was still the highest ever imposed on a company. She said the fine was not the goal but changing behaviour. The fine was based on Intel's European turnover and the duration of the offenses.
She said the case was solidly based on case law and consumer harm.
Kroes welcomed changes to US competition regulation and said she had big hopes for future cooperation.
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AMD CPUs need linux? Ba ha ha ha ha!
Havent you heard? AMD CPUs only run communist software.
Intel CPUs, on the other hand, will bribe you into not buying products from its competitors.
This sort of thing has been going on for decades in the US. 20 years ago I was working on a graphics terminal project. At that point we were basically an Intel shop, but we had National Semi & Motorola in to show their new CPUs. As a programmer, I much preferred either the Nat Semi or Moto parts, because they were much cleaner designs and were not limited to 64K memory segments for a product that needed more than 64K for screen memory. But our preferences got vetoed by the head of hardware engineering, and I ultimately found out why-- Intel engineers stepped in and gave them the complete hardware design fror the project so our engineers didn't have to do anything but put their name on it. Intel made it totally easy to be a hardware engineer for intel products, as they would do your work for you, so no wonder they always chose Intel. Is that anti-competitive? I'm not sure, but it always did seem to me to be a bit underhanded, and at least, we could have fired all our own hardware engineers if upper management had known about it...
AMD not the injured party
@Bassey: No, AMD are not the injured party. Or if they are injured, then they can perfectly well sue Intel themselves. The EU is taking this action because anti-competitive behaviour costs us, the consumers, money. So it's right that the money goes to the EU (thus reducing our taxes) rather than to other chip manufacturers.
It's only us schlubs that actually have to pay fines (parking, speeding, etc).
It might be nice inducement against the delaying tactics used in these cases if the fines grew (and had to be paid).