Wednesday, May 13th 2009

Statement by Intel President and CEO Paul Otellini on EC Ruling

Paul Otellini, Intel Corporation president and CEO today issued the following statement regarding the European Commission decision on Intel's business practices:

"Intel takes strong exception to this decision. We believe the decision is wrong and ignores the reality of a highly competitive microprocessor marketplace – characterized by constant innovation, improved product performance and lower prices. There has been absolutely zero harm to consumers. Intel will appeal."

"We do not believe our practices violated European law. The natural result of a competitive market with only two major suppliers is that when one company wins sales, the other does not. The Directorate General for Competition of the Commission ignored or refused to obtain significant evidence that contradicts the assertions in this decision. We believe this evidence shows that when companies perform well the market rewards them, when they don't perform the market acts accordingly."

"Intel never sells products below cost. We have however, consistently invested in innovation, in manufacturing and in developing leadership technology. The result is that we can discount our products to compete in a highly competitive marketplace, passing along to consumers everywhere the efficiencies of being the world's leading volume manufacturer of microprocessors."

"Despite our strongly held views, as we go through the appeals process we plan to work with the Commission to ensure we're in compliance with their decision. Finally, there should be no doubt whatsoever that Intel will continue to invest in the products and technologies that provide Europe and the rest of the world the industry's best performing processors at lower prices."

Intel's Position on the AMD Antitrust Case
Since the 1990s Intel's principal competitor has been on a concerted campaign to get regulators and courts around the world to prevent Intel from competing aggressively in the market. The aggressive marketing campaign by Advanced Micro Devices (AMD) has included numerous complaints to regulators in multiple jurisdictions which all stem from the same set of allegations and source. It has included a private lawsuit in the U.S. and two in Japan. By all accounts the U.S. lawsuit could become one of largest antitrust cases in the history of U.S. Courts.

AMD's objectives are clear; it is seeking price protection and wants to become more successful by deterring Intel from aggressive competition. Stripped of hyperbole AMD's complaints around the world accuse Intel of competing too aggressively by offering customers attractive prices and marketing, and technical support to win their business.

The microprocessor market is fiercely competitive. That competition has resulted in tremendous benefits to consumers worldwide by providing continuous improvement in technology innovation, performance and capability at consistently lower prices. Intel believes in competition and has never shied away from it. As you will see from information contained on this site Intel believes it operates well within the law.

More information about Intel and "Competition in the Innovation Economy" is available here.Source: Intel
Add your own comment

128 Comments on Statement by Intel President and CEO Paul Otellini on EC Ruling

#1
TheMailMan78
Banstick Dummy
I call BS on this ruling.
AMD's complaints around the world accuse Intel of competing too aggressively by offering customers attractive prices and marketing, and technical support to win their business.
Um yeah. Thats what you do to ummm.....make money? :roll:
Posted on Reply
#2
tkpenalty
by: TheMailMan78
Um yeah. Thats what you do to ummm.....make money? :roll:
Sure.

But you don't seem to realise that intel was paying tertiary firms to NOT stock products with AMD CPUs installed.

I see no other valid reason why AMD's products would be ommited by many OEM's production lines or retailers, as they are better on the value for money side of things, especially during the Pentium 4 Netburst era. The architecture was CLEARLY flawed, bringing shitty performance with high levels of heat and power usage.

However at this point in time it seemed odd that AMD's offerings became a rarity-intel got desperate. Despite AMD's clear technological dominance, they did NOT dominate the market because of -ahem- factors.
Posted on Reply
#3
WhiteLotus
Just once i would love to see a CEO stand up and say:

"You know what, we were wrong. Sorry guys it wont happen again"



by: TheMailMan78
I call BS on this ruling.

Um yeah. Thats what you do to ummm.....make money? :roll:
Apparently the case was also backed by US federal investigations - i wouldn't be surprised if the US jumped on the band wagon and did the same.
Posted on Reply
#4
btarunr
Editor & Senior Moderator
by: WhiteLotus
Just once i would love to see a CEO stand up and say:

"You know what, we were wrong. Sorry guys it wont happen again"
If that statement costs a billion Euros, that would be a day.
Posted on Reply
#5
DareD
Soon US will do the same as the EU.
"Despite its strong defence, Intel is facing a wall of regulatory resistance to its business practices around the world, with antitrust infringement decisions against it now in Japan, Korea, and the EU, while the US authorities are investigating Intel as well," - said David Anderson.

Intel would now have to change its latest advertising slogan from "sponsors of tomorrow" to "the sponsor of the European taxpayer". - Ms Kroes
That's how money are going where they belong to... :D
Posted on Reply
#6
WarEagleAU
Bird of Prey
I dont call the ruling BS, but a little excessive with the 1.05 billion euros. Intel did this in the height of AMDs heyday with the Athlon 64. As was pointed out by Tkpenalty, they offered discounts to those to not stock AMD chips. Dell was forever without AMD chips I believe in a large part to that. Though they did sell a few AMD computers on HSN and stuff, it wasnt near the volume that they had with intel. Its good for Intel to get its bubble burst every once in a while.

One thing I will not agree on is AMD saying Intel is being shady with offering of technical support. I dont care who you are a company should offer all the support (Technical or Customer) that they can for their product(s)
Posted on Reply
#7
snakeoil
today is a fine day for intel

today is a fine day for intel

Posted on Reply
#8
shagg
I concur with the ruling.

just my 2 cents.
Posted on Reply
#9
W1zzard
by: WhiteLotus
Just once i would love to see a CEO stand up and say:

"You know what, we were wrong. Sorry guys it wont happen again"
why was it wrong what intel did? they used their power to do the best for their company, knowing that there would most probably be an investigation and a ruling. yet they did it, and you can bet, they did it because they ran the numbers and realized that even with a big fine it would be worth it.
Posted on Reply
#10
laszlo
what if after the appeal EU fines them with more :laugh:
Posted on Reply
#11
lemonadesoda
Ms Kroes joked in her own news conference that Intel would now have to change its latest advertising slogan from "sponsors of tomorrow" to "the sponsor of the European taxpayer".
Kroes should be FIRED for that statement. It clearly represents a conflict of interest; an opportunity to stuff gready pockets with a ruling that should be economically determined to redress the LOSS TO AMD, and not a win to EU taxpayers.

IF there are ANY payments other than to AMD, there should be a REBATE to all purchasers of Intel systems for being ripped off.

There is NO DEFENSIBLE story as to why EU taxpayers (read: quasi-gvt organisations and their insane bugets of over salaries and over expenses for bureaucrats) should be on "the take" for this.

I repeat, Kroes should be fired for that statement, irrespective of the ruling. It is just plain incompetent to do that. Intel should countersue and have Kroes struck-off the appeal process.
Posted on Reply
#12
tigger
I'm the only one
I think amd are just QQ coz intel are doing better.Dont they realize its dog eat dog and no prisoners in buisness.Maybe if they make cpu's people actually want to buy then they might sell more.
Posted on Reply
#13
FordGT90Concept
"I go fast!1!11!1!"
by: WarEagleAU
I dont call the ruling BS, but a little excessive with the 1.05 billion euros. Intel did this in the height of AMDs heyday with the Athlon 64. As was pointed out by Tkpenalty, they offered discounts to those to not stock AMD chips. Dell was forever without AMD chips I believe in a large part to that. Though they did sell a few AMD computers on HSN and stuff, it wasnt near the volume that they had with intel. Its good for Intel to get its bubble burst every once in a while.

One thing I will not agree on is AMD saying Intel is being shady with offering of technical support. I dont care who you are a company should offer all the support (Technical or Customer) that they can for their product(s)
Dell didn't offer AMD chips for two decades (1985-2006). Dell only started to offer AMD processors in Dimension machines after they aquired Alienware which was already offering AMD chips. As I said in the other thread, offering two different kinds of processors means two different platforms and that adds a lot of extra cost in purchasing, manufacturing, and support. The reason why they did it was because this was just after Core 2 Duo launch and AMD processors were dirt cheap offseting to the subsequent costs.

There's no indiciation, anywhere, that Intel was bribing (or whatever legal term you want to stick in there) Dell to only sell Intel processors. The incentive is cost cutting like we see with auto dealers usually sticking to only one brand of cars (only have to stock one set of parts for replacement).
Posted on Reply
#14
wiak
last time i checked AMD owned Intel with their Athlon 64 chips, but why did AMD only get upto 20% of the market when they had alot better CPUs in 2003?

99% of the time you go into a retailer you only see intel based PCs just a frew years ago
Posted on Reply
#15
allen337
I wish Intel would fold up and go away for a couple of years and see how AMD starts charging $2000 for processors and video cards you got to buy. Without aggressive competition we all lose. I didnt see where Intel held a gun to noones head to get them to buy their product. Newegg should be next on the list and while were at it XFX-EVGA and Sapphire should be sued. AMD are a bunch of crybabies, I want my mommie I cant compete. ALLEN
Posted on Reply
#16
wiak
by: allen337
I wish Intel would fold up and go away for a couple of years and see how AMD starts charging $2000 for processors and video cards you got to buy. Without aggressive competition we all lose. I didnt see where Intel held a gun to noones head to get them to buy their product. Newegg should be next on the list and while were at it XFX-EVGA and Sapphire should be sued. AMD are a bunch of crybabies, I want my mommie I cant compete. ALLEN
well its not THAT, but it is that intel paid OEMs to exclude AMD chips
its like saying that Coca-Cola pays a store not to sell Pepsi

AMD IGPs are superior to any intel IGP
Phenom II is just as fast as Core 2 Quad 9000
Phenom I was just as fast as Core 2 Quad Q6000
Posted on Reply
#17
mdm-adph
by: allen337
I wish Intel would fold up and go away for a couple of years and see how AMD starts charging $2000 for processors and video cards you got to buy. Without aggressive competition we all lose. I didnt see where Intel held a gun to noones head to get them to buy their product. Newegg should be next on the list and while were at it XFX-EVGA and Sapphire should be sued. AMD are a bunch of crybabies, I want my mommie I cant compete. ALLEN
I don't think you understand the situation at all, or have ever read the allegations in any of the numerous articles and news stories.

Personally, I'm still just shocked that there are people who worship the "free market" and yet somehow justify underhanded kickbacks and secret "rebates" in order to stifle competition.

Perhaps these are the same people who think the Mafia are capitalists... :laugh:
Posted on Reply
#18
allen337
by: wiak
well its not THAT, but it is that intel paid OEMs to exclude AMD chips
its like saying that Coca-Cola pays a store not to sell Pepsi

AMD IGPs are superior to any intel IGP
Phenom II is just as fast as Core 2 Quad 9000
Phenom I was just as fast as Core 2 Quad Q6000
You think that Pepsi is only at Pizza hut and Lees fried chicken because coca cola cant compete with free we need to sue pepsi also
Posted on Reply
#19
laszlo
pesi will sue coca and viceversa for using "cola":laugh:
Posted on Reply
#20
iStink
Are you guys all KIDDING ME!?

Intel has been "aggressively competitive" well boo fucking hoo for AMD. I'm sick of these companies that lose, then point blame at any place other than back at themselves.

Just like it pissed me off when these car companies required a bale-out for bad business. They didn't listen to what the consumer wanted, the continued to manufacture junk that nobody would buy, and in the end, even though nobody bought their crap, they were FORCED to buy their crap anyways in a sense with taxes.

So lets put things into the simplest perspective here. Little Johnny and Susie both have lemonade stands. Johnny tells passers by that he'll give 30% more lemonade for the same price as Susie, it tastes better, and he also offers an additional discount if the customer buys lemonade for his whole family from him, and not from Susie. Then Susie cries to mommy that Johnny isn't being fair and Mommy makes Johnny hand over a lot of his money he earned fair and square. Then Mommy goes out and buys a gigolo and some coke with the money she took from Johnny.

Take it how you want it, but the above example is the same thing going on here. AMD is little whiny Susie Creamcheese.
Posted on Reply
#21
snakeoil
by: W1zzard
why was it wrong what intel did? they used their power to do the best for their company, knowing that there would most probably be an investigation and a ruling. yet they did it, and you can bet, they did it because they ran the numbers and realized that even with a big fine it would be worth it.
yes the same thing did hitler.
Posted on Reply
#22
iStink
by: snakeoil
yes the same thing did hitler.
same thing did hitler? Jeez man, ever heard of Godwin's law?

We're not talking about the desecration and extermination of an entire group of people here dude so try not to elevate intel's business practice to such horrendous extremes.

Back when 939 dominated P4, did Intel complain? Nope. They stepped up.

It's a shame that the world is turning out the way it is. If you're a large enough business, and you do bad, you can point blame at the competition for doing too well and you'll be compensated.
Posted on Reply
#23
DonInKansas
by: btarunr


"Intel takes strong exception to this decision.
I would too if I had to pay out all that cash.:laugh:
Posted on Reply
#24
vontrapp
highly competitive microprocessor marketplace
I guess if you think 1 competitor is too many yes then it's "highly competitive" :rolleyes:
Posted on Reply
#25
Steevo
What happens if AMD goes out, and Intel is no longer forced to innovate and can start jumping pricing. AMD got it's foothold as Intel was raping the consumer.


I don't agree with the fine, and what will happen to it, but I honestly do believe that Intel needs a slap on the wrist for what they have done.

http://www.cpu-world.com/CPUs/80486/


A look back at the original market and you can understand AMD's position, they are the only real VIAble competitor to Intel currently. Lets say that you have a Lemonade business, and your neighbor has one also, and you are doing well, you come up with a new formula to sell, that tastes better than your old formula, and your competitors formula. You go to grocery stores and distributors to see if you can get them to sell your lemonade. However your neighbor has bribed the grocers, and distributors, and warehouses to not sell your lemonade. You can't force them to sell yours, even though it is a better product and will allow you to become more profitable and force more competition in the market, thus costing customers less in the long run.


So what do you do?

If in a few years AMD goes under and a Intel chip costs twice what it does now, and ATI being tied to AMD fails also and Nvidia starts REALLY raping the consumers, just remember.


You allowed and supported it.

So far as the car market, imagine their only being two players. Ford and Toyota, but Ford has just bribed your city to NOT allow a new Toyota dealership to be built. Now you have one choice, and they can ask what they want, make what they want, and you have no other options.
Posted on Reply
Add your own comment