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Intel's CPU Coercion Shown in EU Documents


Extinction Agenda
Political User
The European Union on Monday released numerous excerpts and anecdotes from documents used in its recent antitrust action against Intel to show that its decision was justified. In May, the EU fined Intel the equivalent of $1.45 billion, accusing it of violating its antitrust regulations. Intel formally appealed the fine and ruling on July 22.
In numerous incidents, according to the EU, Intel attempted to quash programs at its OEMs from building PCs around microprocessors from rival AMD.
"This is the first time that Intel has had to confront now publicly available facts of its illegal behavior and it won't be the last," said Tom McCoy, AMD's executive vice president of legal affairs, in a statement. "The U.S. FTC and New York Attorney General's continuing investigations and AMD's civil case against Intel will provide other clear demonstrations of Intel breaking the law, and we remain confident that we will win our US civil case against Intel, which goes to trial in March."
Intel representatives could not be immediately reached for comment.
The EU email excerpts describe actions Intel took against Acer, HP, and Lenovo, among others. Between November 2002 and May 2005, Intel payments to HP were conditioned on HP selling AMD-based business desktops only to small and medium enterprises, only via direct distribution channels (rather than distributors), and on HP postponing the launch of its first AMD-based business desktop in Europe by 6 months, the EU said.
"You can NOT use the commercial AMD line in the channel in any country, it must be done direct," the EU reported, according to an email from an undisclosed HP executive. "If you do and we get caught (and we will) the Intel moneys (each month) is gone (they would terminate the deal). The risk is too high."
Likewise, Intel payments to Acer were conditioned on Acer postponing the launch of an AMD-based notebook from September 2003 to January 2004, the EU said. Intel payments to Lenovo were linked to or conditioned on Lenovo postponing the launch of AMD-based notebooks from June 2006 to the end of 2006.
However, there appears to be no smoking gun. The EU's discovery process turned up that such anti-AMD provisions were negotiated orally. "There is no written agreement between Intel and Dell concerning the MCP [rebate] discount, rather, the discount is the subject of constant oral negotiations and agreement," Dell stated, according to the EU.
MSH, a European retailer, also confirmed the relationship, and how it was concealed. "It was clear to MSH that despite the non-exclusivity clause the exclusive nature of the relationship remained, for Intel, an essential element of the relationship between Intel and MSH," MSH said in a submission to the EU. "In fact, [redacted MSH executive] recalls that Intel representatives made it clear to him that the changes in the wording of the agreement had been requested by Intel's legal department, but that in reality the relationship was to continue as before, including the requirement that MSH sell essentially only Intel-based computers."
And in another written submission to the EU, HP added: "[HP] 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."
In another email that was disclosed to the EU, Intel reportedly acknowledged that the AMD Opteron processor was in fact superior. "Opteron is real threat today… Opteron-based single WS [Workstation] benchmarks beat [Intel's] Xeon in all cases," the email said.
Intel's CPU Coercion Shown in EU Documents - Lab Notes by ExtremeTech

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