The Federal Trade Commission has decided to formally
investigate Intel for antitrust for pushing AMD to the wall with its sales
incentives, an answer to a prayer AMD has been saying for years now.
AMD supposedly only brought its mammoth private antitrust
suit against Intel in a
News of the FTC’s action broke on the heels of South Korea
deciding to fine Intel $25.4 million (practically a rounding error) for abusing
its dominant position and offering $37 million in rebates to Samsung and Trigem
alledgedly in exchange for freezing out AMD. Korean authorities said AMD
couldn’t have competed even if its chips were free.
Intel is expected to appeal but can’t do anything until it
gets a copy of the final determination, which could take a while.
Anyway, the FTC’s decision is supposed to have been made by
the commissioners themselves, not the staff, who have been investigating Intel
informally since 2006.
And supposedly the decision to act has a lot to do with the
departure of FTC chairman Deborah Majoras, who’s reportedly been stifling the
pro-investigation camp for months.
The commissioners supposedly want to be able to look their
offshore counterparts in the eye and not come across as wimpy. Intel denies a
report in the Wall Street Journal claiming that the FTC acted on some damning
Now under formal investigation, Intel will be able to turn
over third-party discovery – like contracts, costs, pricing information, negotiation
collateral and communications – collected from PC makers for the AMD antitrust
case that it couldn’t previously give to the FTC because of a 2006 protective
order. Now it can thanks to an FTC subpoena. Aside from Intel and AMD the FTC has
also served subpoenas on unidentified PC makers directly.
Intel maintains that its pricing policies are within the law
and points to a slew of a dozen or so Supreme Court decisions that it says back
it up. And it has repeatedly denied AMD’s allegation that Intel sells chips for
less than cost and reacts to such contentions as if somebody just defiled its
copy of the Koran.
Meanwhile, the European Commission is expected to expand on
the antitrust charges it made against Intel last year.
The state of
A Japanese investigation of Intel and its rebates wound up
with Intel maintaining its innocence but signing a consent decree anyway in
2005. In the decree Intel reportedly promised not to put exclusivity clauses in
its contracts; it claims it never had exclusivity clauses in its contracts.
AMD later filed suit against Intel in