When Intel paid AMD $1.25 billion to buy off the civil anti-trust case which AMD had brought against Intel, it was thought that, with AMD as chief complainant now out of the way, the US Federal Trade Commission (FTC) might drop its criminal investigation into Intel’s alleged anti-competitive behaviour.
Instead the FTC came out with all guns blazing.
“Intel’s been running roughshod over the principles of fair play and the laws protecting competition on the merits”, says Richard Feinstein, Director of the FTC’s Bureau of Competition, “the Commission’s action today seeks to remedy the damage that Intel has done to competition, innovation, and, ultimately, the American consumer.”
The FTC says: ‘Intel has waged a systematic campaign to shut out rivals’ competing microchips by cutting off their access to the marketplace. In the process, Intel deprived consumers of choice and innovation in the microchips that comprise the computers’ central processing unit, or CPU.’
The FTC charges Intel with: ‘Carrying out its anti-competitive campaign using threats and rewards aimed at the world’s largest computer manufacturers, including Dell, Hewlett-Packard, and IBM, to coerce them not to buy rival computer CPU chips. Intel also used this practice, known as exclusive or restrictive dealing, to prevent computer makers from marketing any machines with non-Intel computer chips.’
Apparently, Intel also put code its compilers which would slow down any PC which used an AMD chip.
‘Allegedly, Intel secretly redesigned key software, known as a compiler, in a way that deliberately stunted the performance of competitors’ CPU chips’, says the FTC, ‘Intel told its customers and the public that software performed better on Intel CPUs than on competitors’ CPUs, but the company deceived them by failing to disclose that these differences were due largely or entirely to Intel’s compiler design.’
After illegally skewing the CPU market, Intel then turned to trying to skew the GPU market, says the FTC.
GPUs have lessened the need for CPUs, says the FTC, and therefore pose a threat to Intel’s monopoly power.
The FTC states: ‘Intel has responded to this competitive challenge by embarking on a similar anticompetitive strategy, which aims to preserve its CPU monopoly by smothering potential competition from GPU chips such as those made by Nvidia, the FTC complaint charges. As part of this latest campaign, Intel misled and deceived potential competitors in order to protect its monopoly. The complaint alleges that there also is a dangerous probability that Intel’s unfair methods of competition could allow it to extend its monopoly into the GPU chip markets. ‘
The FTC is the fifth anti-trust action to be brought against Intel. In actions by Korea, Japan and Europe, Intel has been found guilty of anti-trust illegalities and fined; a fourth action from the State of New York has still to be heard. The FTC’s action makes it five.
Meanwhile Intel’s shareholders are bringing civil class actions against Intel and its management alleging that shareholders’ interests have been damaged by Intel’s alleged anti-competitive practices.
Would you want to handle all that merde for a mere $12 million a year in salary?