Government suing Intel for unfair business practices

[markjs]

U.S. Sues Intel on Market Dominance Abuse

WASHINGTON (Reuters) - The U.S. government filed suit against Intel Corp <INTC.O> on Wednesday, accusing the chip giant of illegally using its market dominance to stifle competition for a decade.

The Federal Trade Commission, one of two U.S. agencies that enforce antitrust law, said Intel was trying to shut its competitors out of the market.

Shares of Intel fell 2 percent on the news, while shares of chip competitors like Advanced Micro Devices Inc <AMD.N> and Nvidia Corp <NVDA.O> rose roughly 6 percent.

"Intel has engaged in a deliberate campaign to hamstring competitive threats to its monopoly," said Richard Feinstein, director of the FTC's Bureau of Competition.

"It's been running roughshod over the principles of fair play and the laws protecting competition on the merits."

Intel makes 80 percent of the world's central processing units, the brains of personal computers, and has been accused by other antitrust bodies and rivals of acting illegally to maintain that dominance....

The rest of the story is here.

I wonder what this means about prices for us lowly consumers? I just purchased one of the CELERON E3300 2.5GHz chips after hearing great things about it being a Conroe with a smaller cache. I used to buy all AMD but now I just buy whatever. I actually ended up with an intel setup so I could make a working Hackintosh. In fact this machine, for the sake of since I work on people's computers, boots by default to Windows 7 but offers XP Media Center (Fancy XP Pro), Vista, and OS X as well.

[markjs]

Antitrust lawsuit seeks fundamental changes at Intel

Instead of a fine, the FTC wants the chip maker prohibited from using practices that the agency says give the company an unfair advantage. Intel calls the case 'misguided.'
By Jim Puzzanghera and David Sarno

December 16, 2009 | 4:11 p.m.

Reporting from Los Angeles and Washington - Federal regulators accused Intel Corp. of abusing its market dominance to stifle competition in a lawsuit Wednesday that, instead of seeking monetary damages, would impose more painful, fundamental changes on the way the world's leading chip maker does business.

The suit by the Federal Trade Commission is more far-reaching than any of the other regulatory cases brought in recent years against Intel, which commands about 81% of the world's market for central processing units, the brains of computers and other electronic gear.

If it prevails, the FTC said consumers could eventually see computer prices drop as Intel's grip on the chip market loosened and more manufacturers were able to compete....

The rest of the story from the LA Times.

[equinoxe3d]

An interesting article about it is up at AnandTech :

http://www.anandtech.com/cpuchipsets...oc.aspx?i=3690

Since they basically settled with AMD a while ago on the CPU side, a great deal of the charges are on the chipset, GPU and GPGPU sides :

1. Intel eliminated the future threat of NVIDIA’s chipset business by refusing to license the latest version of the DMI bus (the bus that connects the Northbridge to the Southbridge) and the QPI bus (the bus that connects Nehalem processors to the X58 Northbridge) to NVIDIA, which prevents them from offering a chipset for Nehalem-generation CPUs.

2. Intel “created several interoperability problems” with discrete CPUs, specifically to attack GPGPU functionality. We’re actually not sure what this means, it may be a complaint based on the fact that Lynnfield only offers single PCIe x16 connection coming from the CPU, which wouldn’t be enough to fully feed 2 high-end GPUs.

3. Intel has attempted to harm GPGPU functionality by developing Larrabee. This includes lying about the state of Larrabee hardware and software, and making disparaging remarks about non-Intel development tools.

4. In bundling CPUs with IGP chipsets, Intel is selling them at below-cost to drive out competition (given Intel’s margins, we find this one questionable. Below-cost would have to be extremely cheap).

5. Intel priced Atom CPUs higher if they were not used with an Intel IGP chipset.

6. All of this has enhanced Intel’s CPU monopoly.

IMO the third point is the most interesting, considering Larrabee's consumer release was recently canned. Given the trial is in 9 months it will be interesting to see how it pans out.

Overall, in the short-medium term I guess it opens the possibility of a cheaper version of Westmere CPUs without the integrated GPU.