AMD File Antitrust Lawsuit Against Intel

Hurricane Andrew

Golden Member
Nov 28, 2004
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Here's a link to the article.

Not quite sure how I feel about this. AMD does certainly make some valid points. I guess the real test will be how much AMD knows and can prove regarding Intel's "bullying" tactics. If they simply offer better pricing, and other benign incentives, AMD is wasting its time. If Intel is coercing vendors to buy only their chips, then it could be interesting.
 

Zebo

Elite Member
Jul 29, 2001
39,398
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Another:
http://quote.bloomberg.com/apps/news?pid=10000006&sid=ayhayNVKBkBw&refer=home

According to AMD, Michael Capellas, former chief executive of Compaq Computer Corp., told AMD in 2000 that Intel withheld the delivery of some microprocessors he needed for servers because of the amount of business he had given to AMD.

He told AMD he would stop buying from it, saying he ``had a gun to his head,'' according to a statement from AMD today. Capellas is now Chief Executive Officer of MCI Inc.

`Risk of Retaliation'

Office Depot Inc., the world's second-largest office supplies retailer, refused to stock laptop computers that were powered with AMD's chips because it was concerned about the ``risk of retaliation,'' according to AMD

How do I feel? Using your monoploy power to threaten VARs is unethical and violates anti-trust laws we have. Get ride of the laws and AMD has no case but as it is they certainly do. From Hector: http://www.amd.com/us-en/Weblets/0,,7832_12670_12684,00.html?redir=CORBF02

You have mixed feelings cuz Just like Hector says:

For most competitive situations, this is just business. But from a monopolist, this is illegal.

 

dmcowen674

No Lifer
Oct 13, 1999
54,889
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www.alienbabeltech.com
Originally posted by: linkgoron
What happens if AMD wins?

More Vendors featuring AMD chips.

Think of it this way. The way it is now if an AMD PC was a Car you wouldn't be able to find hardly any dealerships around to go get the car. Not because of Free Market forces but because Intel has used it's money to discourage any AMD dealerships to open.
 

Aegeon

Golden Member
Nov 2, 2004
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The other thing that can happen if AMD wins is that they are entitled under the law to triple damages for any money they can prove to the court they lost from Intel's anti-competative practices. This amount could easily total into the billions of dollars.
 

Hurricane Andrew

Golden Member
Nov 28, 2004
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Frankly, I think there is a better case to be made against Intel than was made against MSFT. This is a case purely about business practices. There's no esoteric discussion of software and embedded code, what's part of the OS, can the browser be separated from the OS, etc. This is the kind of meat and potatoes case that the Court of Chancery here in Delaware deals with virtually every day (though not on quite the scale that we're talking about here).

Oops... Just saw that they filed in District Court, not Delaware's Court of Chancery. Oh well, the District Court can handle it too, just not as well ;)
 

CTho9305

Elite Member
Jul 26, 2000
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AMD's press release is located here.

According to the complaint, Intel has unlawfully maintained its monopoly by, among other things:

* Forcing major customers such as Dell, Sony, Toshiba, Gateway, and Hitachi into Intel-exclusive deals in return for outright cash payments, discriminatory pricing or marketing subsidies conditioned on the exclusion of AMD;
_____o According to industry reports, and as confirmed by the JFTC in Japan, Intel has paid Dell and Toshiba huge sums not to do business with AMD.
_____o Intel paid Sony millions for exclusivity. AMD's share of Sony's business went from 23 percent in '02 to 8% in '03, to 0%, where it remains today.

* Forcing other major customers such as NEC, Acer, and Fujitsu into partial exclusivity agreements by conditioning rebates, allowances and market development funds (MDF) on customers' agreement to severely limit or forego entirely purchases from AMD;
_____o Intel paid NEC several million dollars for caps on NEC's purchases from AMD. Those caps assured Intel at least 90% of NEC's business in Japan and imposed a worldwide cap on the amount of AMD business NEC could do.

* Establishing a system of discriminatory and retroactive incentives triggered by purchases at such high levels as to have the intended effect of denying customers the freedom to purchase any significant volume of processors from AMD;
_____o When AMD succeeded in getting on the HP retail roadmap for mobile computers, and its products sold well, Intel responded by withholding HP's fourth quarter 2004 rebate check and refusing to waive HP's failure to achieve its targeted rebate goal; it allowed HP to make up the shortfall in succeeding quarters by promising Intel at least 90% of HP's mainstream retail business.

* Threatening retaliation against customers for introducing AMD computer platforms, particularly in strategic market segments such as commercial desktop;
_____o Then-Compaq CEO Michael Capellas said in 2000 that because of the volume of business given to AMD, Intel withheld delivery of critical server chips. Saying "he had a gun to his head," he told AMD he had to stop buying.
_____o According to Gateway executives, their company has paid a high price for even its limited AMD dealings. They claim that Intel has "beaten them into 'guacamole'" in retaliation.

* Establishing and enforcing quotas among key retailers such as Best Buy and Circuit City, effectively requiring them to stock overwhelmingly or exclusively, Intel computers, artificially limiting consumer choice;
_____o AMD has been entirely shut out from Media Markt, Europe's largest computer retailer, which accounts for 35 percent of Germany's retail sales.
_____o Office Depot declined to stock AMD-powered notebooks regardless of the amount of financial support AMD offered, citing the risk of retaliation.

* Forcing PC makers and tech partners to boycott AMD product launches or promotions;
_____o Then-Intel CEO Craig Barrett threatened Acer's Chairman with "severe consequences" for supporting the AMD Athlon 64^(TM) launch. This coincided with an unexplained delay by Intel in providing $15-20M in market development funds owed to Acer. Acer withdrew from the launch in September 2003.

* Abusing its market power by forcing on the industry technical standards and products that have as their main purpose the handicapping of AMD in the marketplace.
_____o Intel denied AMD access to the highest level of membership for the Advanced DRAM technology consortium to limit AMD's participation in critical industry standard decisions that would affect its business.
_____o Intel designed its compilers, which translate software programs into machine-readable language, to degrade a program's performance if operated on a computer powered by an AMD microprocessor.
 

TraumaRN

Diamond Member
Jun 5, 2005
6,893
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Linkage

AMD's lawyer said in a CNBC television interview Tuesday that the company could look for hundreds of millions of dollars in damages.

Sounds to me like AMD is ready to goto bat with the big boys in this case, from reading the whole 48 page court filing I figure AMD has a chance, personally I'll root for them especially if it means chip prices will drop as a result :)
 
Dec 27, 2001
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I've favored AMD chips since the Athlon XP and have only built a couple Intel rigs. But, really, this is just Capitalism. If the threat to refuse to sell products to a vendor is incentive enough for them to agree not to sell your competititors product, well, then, that means you have a hell of a product in their eyes. That means companies who want to compete, like AMD, need to come into the market with superior product for less money, which they have. And, if AMD can't put together a scenario for vendors willing to call Intel's bluff that makes them feel secure, well, then that's their own fault.
 

ZobarStyl

Senior member
Mar 3, 2004
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I think AMD could've done this years ago, but they had to really wait until they had both sufficient ammo (enough testimony from various sources) and a product that really outshines the competing Intel offering. A lot of what we're seeing isn't just for legal reasons, but public advertisement (it's frontpage yahoo news).

Think about it: the average consumer who has no idea AMD chips even exist now sees that the reason they never saw AMD chips isn't because they are cheap knockoffs (which is what the average American consumer assumes about any unknown product) but because Intel illegally kept them out. Then they go and do a little research and realize the current AMD lineup is a superior product to the Pentium equivalent.

In addition, even if AMD loses, the FTC still will keep an eye on the obvious Dell dealings, so Dell can start selling some AMD chips and if any suspicious happenings occur (higher pricing, 'missed' shipments) Dell can call foulplay and get immediate action. Overall this is a great move for AMD, personally I don't care if they get any money out of it, just more marketability (moving product from actual retailers for once).
 

imported_michaelpatrick33

Platinum Member
Jun 19, 2004
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This suit is also rather cleverly timed in my opinion. These cases can drag out for years as we all know. What is AMD ready top open in early 2006? FAB 36 with another one being discussed for late 2007 or early 2008, also in Germany. AMD could say during the course of the case, in early to mid 2006, that they have Fabrication capacity to supply Dell with chips (or Sony) (remember Dell said they would not go with AMD because of supply issues [if this complaint is true then it is really money]. Intel, Dell, Sony etc. are then placed in a less attractive rebuttal position because they can't readily use the [possibly valid] excuse that AMD doesn't have the Fabrication numbers to supply the chips it wishes to sell.
 
Dec 27, 2001
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Originally posted by: ZobarStyl
Think about it: the average consumer who has no idea AMD chips even exist now sees that the reason they never saw AMD chips isn't because they are cheap knockoffs (which is what the average American consumer assumes about any unknown product) but because Intel illegally kept them out. Then they go and do a little research and realize the current AMD lineup is a superior product to the Pentium equivalent.

Even worse, AMD kicked themselves in the nuts with the K6....the one meant to compete with the PII. The chip, especially the K6-2, was a decent enough chip, but the chipsets were all immature which gave AMD an aweful name. Popping up in the mainstream market around the same time as Cyrix was bad fortune since they looked, together, like some cheap knock-off immitators. Even now, you have some non-techies or newbs touting Intel's superior "stability".
 

Duvie

Elite Member
Feb 5, 2001
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Originally posted by: HeroOfPellinor
I've favored AMD chips since the Athlon XP and have only built a couple Intel rigs. But, really, this is just Capitalism. If the threat to refuse to sell products to a vendor is incentive enough for them to agree not to sell your competititors product, well, then, that means you have a hell of a product in their eyes. That means companies who want to compete, like AMD, need to come into the market with superior product for less money, which they have. And, if AMD can't put together a scenario for vendors willing to call Intel's bluff that makes them feel secure, well, then that's their own fault.


WOW that is an idiotic statement....

This doesn't have much to do with "quality" of the product alone...It also has to do with the mind perception of users and buyers who have been conditioned on INtel inside commercial...A company needs to have Intel cpus just for the fact for the large precentage of ppl who have not heard of AMD...that is AMD's fault...

Another reason is supply....For large vendors goping AMD at the threat of INtel not supplying them could be disastorous cause AMD as being a smaller market provider could have supply issues to cover what they normally sold in INtel volume...This needless to say ties back into it as a factor of these strong-arm tactics...

It appears AMDs anemic marketshare growth through the good years has had considerable help.

Intel shows they are a chicken-sh^t company. Too afraid to go on the merit of their own product....

I honestly am pro-business and I dont like the courts and government getting involved. I was in favor of MS in their lawsuit but this stinks of tactics that make that look plain silly. I hoipe INtel gets the crap slapped out of them.
 
Dec 27, 2001
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Originally posted by: Duvie
This doesn't have much to do with "quality" of the product alone...It also has to do with the mind perception of users and buyers who have been conditioned on INtel inside commercial...A company needs to have Intel cpus just for the fact for the large precentage of ppl who have not heard of AMD...that is AMD's fault...
That's what I said. Why are you making the same "idiotic statement" as me?
"that means you have a hell of a product in their eyes"
Another reason is supply....For large vendors goping AMD at the threat of INtel not supplying them could be disastorous cause AMD as being a smaller market provider could have supply issues to cover what they normally sold in INtel volume...This needless to say ties back into it as a factor of these strong-arm tactics...
Again reiterating what I said.
"if AMD can't put together a scenario for vendors willing to call Intel's bluff that makes them feel secure, well, then that's their own fault."
[/quote]

If I made an idiotic statement and you just rephrased everything I said.........what does that make you?
 

Stoneburner

Diamond Member
May 29, 2003
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TO the morons barking about capitalism, why??? It would be very entrepreneurial for me to set up a glass shop and then go around at night breaking every window in the city. It's called UNETHICAL. NOw a few i supposed misguided souls around 100 years ago thought that concentrating market power throw strong arm tactics is BAD For the market. And practically every nation has adopted anti trust statutes.... so maybe some educated people tend to think such behavior is bad?
 

Zebo

Elite Member
Jul 29, 2001
39,398
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You guys read that compliant and you'll understand why it's essentially impossible for AMD to suceed. It's at least 80 instances of Intel holding huge companies hostage and other dirty tricks combined with thier limitless bank to undercut AMD where they are trying to make endroads. Sh1t AMD offered 1 million processors for free to HP, and intel made it so they could'nt take the free processors!!!

Dispite all the history of intel tactics I also found some other stuff interesting.. Like 64 bits of sempron referced.. Like delining maket share from 2001 dispite superior product... like intels margins vs. OEM's... lots of juicy tidbits in there..
 

ender11122

Golden Member
Feb 17, 2005
1,172
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Originally posted by: Zebo
Sh1t AMD offered 1 million processors for free to HP, and intel made it so they could'nt take the free processors!!!

Did they really. Yikes!! Even a computer illiterate judge that has been bought and paid for by intel can't ignore that.
 

n7

Elite Member
Jan 4, 2004
21,281
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Wow, i read nearly the entire Lawsuit .pdf

Disgusting, absolutely disgusting.

It makes a lotta sense too.

I've been working in retail for a 1.5 yrs., & the AMD-based PCs sell very well...but we almost never have any to sell, so people buy the crippled 533MHz FSB non-HT P4 instead, or the Celerons.

This makes me sick, because even if only a few of the things AMD has outlined have happened, it would explain a lot of things.
 
Dec 27, 2001
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Originally posted by: Stoneburner
TO the morons barking about capitalism, why??? It would be very entrepreneurial for me to set up a glass shop and then go around at night breaking every window in the city. It's called UNETHICAL. NOw a few i supposed misguided souls around 100 years ago thought that concentrating market power throw strong arm tactics is BAD For the market. And practically every nation has adopted anti trust statutes.... so maybe some educated people tend to think such behavior is bad?

Nobody said Capitalism was kind and gentle.

If I make a really REALLY good cookie, then I have done something tremendous that is worth being rewarded for (In a Capitalist society that is). I can choose to not leverage my cookies reputation and let it sit on a rack with 15 other brands, or I can only sell to places who will cave to my demands. I want each of them to carry only my cookies and to buy in very large quantities. They, the free businesses, can choose to give into my conditions of partnership or they can choose not to. It depends on how VALUEABLE my cookies are to them. Maybe my cookies taste awful, but I've spent tens of thousands on advertising all over town to establish a name.....it doesn't matter. If carrying only my cookies is a safer bet than carrying several other brands and not carrying mine, then they'll take that route. They aren't conspiring against other cookie makers, they're just doing what makes the most sense to their bottom line. Sure I'm being a ruthless bastard and not many people including the store owners would like me very much, but that's my choice to conduct business thusly.

See? Everybody with choices to make.....THAT is freaking Capitalism, junior.
 

ender11122

Golden Member
Feb 17, 2005
1,172
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Originally posted by: HeroOfPellinor
Originally posted by: Stoneburner
TO the morons barking about capitalism, why??? It would be very entrepreneurial for me to set up a glass shop and then go around at night breaking every window in the city. It's called UNETHICAL. NOw a few i supposed misguided souls around 100 years ago thought that concentrating market power throw strong arm tactics is BAD For the market. And practically every nation has adopted anti trust statutes.... so maybe some educated people tend to think such behavior is bad?

Nobody said Capitalism was kind and gentle.

If I make a really REALLY good cookie, then I have done something tremendous that is worth being rewarded for (In a Capitalist society that is). I can choose to not leverage my cookies reputation and let it sit on a rack with 15 other brands, or I can only sell to places who will cave to my demands. I want each of them to carry only my cookies and to buy in very large quantities. They, the free businesses, can choose to give into my conditions of partnership or they can choose not to. It depends on how VALUEABLE my cookies are to them. Maybe my cookies taste awful, but I've spent tens of thousands on advertising all over town to establish a name.....it doesn't matter. If carrying only my cookies is a safer bet than carrying several other brands and not carrying mine, then they'll take that route. They aren't conspiring against other cookie makers, they're just doing what makes the most sense to their bottom line. Sure I'm being a ruthless bastard and not many people including the store owners would like me very much, but that's my choice to conduct business thusly.

See? Everybody with choices to make.....THAT is freaking Capitalism, junior.



But thats what makes it an ANTITRUST lawsuit. Intel is the ONLY company that can supply the chips, so by threating to hold from certain retailers FORCES them to go with Intel and not with AMD AND Intel= Perfectly legal grounds for a lawsuit
 
Dec 27, 2001
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Originally posted by: ender11122
But thats what makes it an ANTITRUST lawsuit. Intel is the ONLY company that can supply the chips, so by threating to hold from certain retailers FORCES them to go with Intel and not with AMD AND Intel= Perfectly legal grounds for a lawsuit

No, AMD also provides chips. Superior and cheaper chips at that. But Intel has spent millions on advertising to get their name out. Think about that. A CPU manufacturer has television commercials. Hell, Asus could do the same thing and your Uncle Joe, when going to Best Buy for a new computer, would probably ask if they had "Asus Inside".

All any company had to do was call Intel's bluff and say, fine then we're going with AMD. Why didn't they? Because AMD couldn't get them what they wanted. Maybe they couldn't keep up with quantities or prices or maybe they didn't have a marketable enough name. Who knows. The fact is that a business will make a the decision that means the most profit for them in the long run and if you can't convince them to go with you, then that's your fault.
 

ProviaFan

Lifer
Mar 17, 2001
14,993
1
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Originally posted by: HeroOfPellinor
Nobody said Capitalism was kind and gentle.

If I make a really REALLY good cookie, then I have done something tremendous that is worth being rewarded for (In a Capitalist society that is). I can choose to not leverage my cookies reputation and let it sit on a rack with 15 other brands, or I can only sell to places who will cave to my demands. I want each of them to carry only my cookies and to buy in very large quantities. They, the free businesses, can choose to give into my conditions of partnership or they can choose not to. It depends on how VALUEABLE my cookies are to them. Maybe my cookies taste awful, but I've spent tens of thousands on advertising all over town to establish a name.....it doesn't matter. If carrying only my cookies is a safer bet than carrying several other brands and not carrying mine, then they'll take that route. They aren't conspiring against other cookie makers, they're just doing what makes the most sense to their bottom line. Sure I'm being a ruthless bastard and not many people including the store owners would like me very much, but that's my choice to conduct business thusly.

See? Everybody with choices to make.....THAT is freaking Capitalism, junior.
That would be fine, except some idiot a long time ago got PO at some of the unethical practices used by big businesses and evidently all of our stupid senators agreed, and that's how we got antitrust legislation. Obviously, your superior intellect enables you to see how retarded this antitrust legislation really is, so why not go ahead and lobby congress to get it reversed? :roll:
 

ender11122

Golden Member
Feb 17, 2005
1,172
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Originally posted by: HeroOfPellinor
Originally posted by: ender11122
But thats what makes it an ANTITRUST lawsuit. Intel is the ONLY company that can supply the chips, so by threating to hold from certain retailers FORCES them to go with Intel and not with AMD AND Intel= Perfectly legal grounds for a lawsuit

No, AMD also provides chips. Superior and cheaper chips at that. But Intel has spent millions on advertising to get their name out. Think about that. A CPU manufacturer has television commercials. Hell, Asus could do the same thing and your Uncle Joe, when going to Best Buy for a new computer, would probably ask if they had "Asus Inside".

All any company had to do was call Intel's bluff and say, fine then we're going with AMD. Why didn't they? Because AMD couldn't get them what they wanted. Maybe they couldn't keep up with quantities or prices or maybe they didn't have a marketable enough name. Who knows. The fact is that a business will make a the decision that means the most profit for them in the long run and if you can't convince them to go with you, then that's your fault.



So because Intel can bribe retailers, withholding money and shippments, makes the retailer more profit (or less loss in profit), it is a good idea and should be legal?