Intel fined $1.5bn for "harming millions" of PC buyers

 

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Posted on 13 May 2009 at 10:52

The EC has imposed a record $1.45 billion fine on Intel, and ordered it to halt illegal rebates and other practices to squeeze out rival AMD.

Which PC makers took Intel's kickbacks? Find out here

Intel boss takes strong exception to EU ruling

"Intel has harmed millions of European consumers by deliberately acting to keep competitors out of the market for computer chips for many years," says European Union Competition Commissioner Neelie Kroes.

The EU executive found Intel guilty of paying computer makers to postpone or cancel plans to launch products that used AMD chips, paid secret rebates to computer makers to use Intel chips, and paid a major retailer to stock only computers with its chips.

The Commission argued that "everyone but Intel was worse off in this anti-competitive scenario" and has ordered the chip maker to "cease the illegal practices immediately to the extent that they are still ongoing."

The EU says Intel may continue to offer rebates, so long as they are legal and not conditional on manufacturers "buying less of AMD's products or not buying them at all."

The Commission says Intel must pay the fine, which represents 4.15% of the company's 2008 turnover, within three months of the date of the notification of the decision.

The EU antitrust fine is the biggest imposed on an individual company, and follows an investigation of Intel's practices dating back to 2002. Investigators claim Europe accounts for 30% of Intel's global 22 billion euro market.

Responding to the charges, Intel claimed it was being unfairly discriminated against.

"We are confident that the worldwide microprocessor market is functioning normally and is highly competitive in Europe and elsewhere. Intel's conduct has always been lawful, pro-competitive and beneficial to consumers," the company says.

Intel goes on to claim that the complaint "suggests the Commission supports AMD's position that Intel should be prevented from competing fairly and offering price discounts which have resulted in lower prices for consumers.

"It's clear the allegations stem from the same set of complaints that our competitor, AMD, has been making to regulators and courts around the world for more than 10 years."

Author: Stuart Turton and Reuters