European Commission Publishes Evidences of Intel’s Abuse of Dominant Position

EC Shows How Intel Broke the Antitrust Laws

by Anton Shilov
09/21/2009 | 09:31 PM

The European Commission on Monday disclosed evidences proving that Intel Corp. abused its dominant position on the market to ensure its market share. Numerous companies received special rebates on condition that they would not utilize microprocessors from Advanced Micro Devices.

 

Earlier this year the European Commission slapped Intel with record $1.44 billion fine for anticompetitive business practices and violation of the region’s laws. The chipmaker said it would appeal and did not admit its guilt. The EC published excerpts from emails of various executives at computer makers which discussed rebates that Intel provided on condition of exclusion of processors from PC makers’ lineups.

According to EC, Intel abused its dominant position in the x86 central processing units market by implementing a series of conditional rebates to computer manufacturers and to a European retailer and by taking other measures aimed at preventing or delaying the launch of computers based on competing products (so-called 'naked restrictions').

Here are some of the examples that were brought by the European Commission:

Other statements from computer manufacturers and MSH outline how the various Intel conditions were an important factor in their decisions not to partially switch to or buy more x86 CPUs from AMD, Intel's main competitor in the x86 CPU market. For instance, in a submission to the Commission, HP stated that it " can confirm that Intel's inducements (in particular the block rebates) were a material factor in determining HP's agreement to the unwritten conditions. As a result (...) HP [Business desktop PC division] stayed at least 95% aligned to Intel."

Intel believes that its business practices are completely legal and that the decision of the EC is wrong.

“Intel is convinced that the Commission's conclusions regarding its business practices are wrong, both factually and legally. Intel has appealed the Commission's decision. We are committed to ethical business behavior and compliance with all applicable laws and regulations governing business practices. Intel has adhered to those standards and acted legally at all times in this matter,” an official statement by Intel reads.