Fair and Open Competition Home — All hell is breaking loose regarding the antitrust suit against Intel. Here is the AMD website devoted to the problem.
We have filed a 48-page, detailed Complaint in federal district court. Because, as our Complaint explains exhaustively, Intel’s actions include:
* Forcing major customers to accept exclusive deals,
* Withholding rebates and marketing subsidies as a means of punishing customers who buy more than prescribed quantities of processors from AMD,
* Threatening retaliation against customers doing business with AMD,
* Establishing quotas keeping retailers from selling the computers they want, and
* Forcing PC makers to boycott AMD product launches.For most competitive situations, this is just business. But from a monopolist, this is illegal.
CLICK HERE to get the entire complaint in PDF format. Well worth reading. Interesting from a number of perspectives. I may be commenting on this in this week’s Marketwatch column.
The webcast of the conference call discussing the case will be available here for the 10 days. Hopefully someone will archive it after that.
AMD has a tough road ahead. There is no doubt that Intel has a monopoly. Sure AMD sells a lot of chips. But Intel could squash AMD any time it wanted. AMD first existed due to IBM’s discretion. Now AMD exists under Intel’s discretion.
But Intel cannot squash AMD because then everyone who know for certain that Intel has a monopoly. So Intel keeps AMD alive solely to keep the Feds off its back.
So AMD will offer tons of evidence about Intel’s monopoly, Intel will point out AMD’s growing market share. And the Feds will once again drop the whole issue.
I was surprised by the timing of this action until I read AMD’s complaint. Specifically point #23.
“Computer manufacturers would also encounter high switching costs in moving from x86 processors to other architectures, and no major computer maker has ever done it. In short, demand is not cross-elastic between x86 microprocessors and other microprocessors at the competitive level.”
Then it hit me. Apple is doing (and has done in the past) exactly what AMD claims is impossible! They are an (arguably) major computer manufacturer undergoing a processor transition. If Apple is successful in it’s transition (as it was in the past), it would seriously undermine AMD’s claim of Intel monopoly. After all, if Apple can switch from PowerPC to x86 and be successful, why can’t another manufacturer jump from Intel x86 to AMD x86?
Apple’s previous jump from 68K to PowerPC happened too long ago to be relevant to a claim about Intel today. But it’s current jump seriously weakens the central pillar of AMD’s claim. After all, AMD themselves publicly acknowledge that all the things that Intel has done would be perfectly fine if they were not a monopoly.
This article should have been called “Apple screws AMD again”
Oscar
from AMD’s website:
http://www.amd.com/us-en/Weblets/0,,7832_12670_13047,00.html
Competition: The Soul of Innovation
Competition is the critical driver of performance and innovation. It benefits everyone by enabling us to choose from an array of excellent products at affordable prices. Competition encourages the adoption of innovation as companies evolve and offer new ideas in order to flourish in the marketplace.
Products should compete on their own merits, and consumers everywhere should have the ability to easily choose the best products available for purchase. Fair and open competition dictates that the best product wins, and market forces prevail.
Innovation fuels economic growth in the global economy. It creates an evergreen environment of new markets – allowing us to reach new customers with existing products – and to serve today’s customers with new products and services.
Doesn’t this seem like it was thrown in at the last minute? For a company that can throw a 48-page complaint at a market “bully”, three paragraphs of buzzwords and key phrases are nothing more than lip service. This is just another example of “Hey! the law can help us get back at these guys for hurting our business.”
Why not use the law to get some advantage? Everyone seems to be doing it in the US…
Anyway, it’ll take years for anything to come out of this? Maybe it’s all done for the publicity of it?
As for Apple going Intel weakening AMD’s claim, maybe it doesn’t – after all Apple went *to* Intel, not away from it.
My guess is this case will fail. This doesn’t look to be any stronger than the complaints against Microsoft, and I read in the Wall Street Journal that Intel has had an eye on anti-trust issues for decades, so they are probably better prepared than Microsoft which just lied and stalled. AMD basically needs to get a judge to define the market very narrowly, ignoring Apple, XBox and Playstation, etc. and even then I doubt that they can make a case.
Everyone I know has moved to AMD but I guess DIY consumers don’t support a business as well and as strongly as OEM’s. It’s definitely difficult to get a model to change when the few decision makers are so heavily influenced with “rewards” from the prevailing company.
Pepsi generally wins taste tests, but they haven’t been able to match Coca-Cola’s brand name and all the deals that they give restaurants. Should Pepsi file for antitrist too?
Oscar (comment #2):
Apple is moving TOO x86 not from x86. AMD is correct in saying no one has moved FROM x86 to another platform. If anything Apple’s move to x86 and using Intel only helps AMD prove that Intel has a monopoly in the x86 market.
Apple is able to switch processors because of it’s vertical integration. NVidia switches processors, slot types, and complete architectures all the time and no one blinks because they are selling a finished product. If you had to buy your graphics card and GPU separately this wouldn’t be the case. AMD’s situation and Apple’s situation aren’t comparable in this case.