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

#1
Easy Rhino
Linux Advocate
mdm-adph said:
Good points.

However, you left something out -- conversely, once your company has reached a certain percentage of market share, you no longer have a right to demand that your buyer buy from only you.
and this is where the socialists always go wrong. who dictates what percentage of market share is enough? the government? so are you saying that once you become highly succesful you actually are punished and lose your right to your own property? since when is being good at what you do illegal? remember, a companies job is to make money, not create competition or increase societal progress.
Posted on Reply
#2
FordGT90Concept
"I go fast!1!11!1!"
mdm-adph said:
However, you left something out -- conversely, once your company has reached a certain percentage of market share, you no longer have a right to demand that your buyer buy from only you.
Put simply, you're discriminating against Intel for being successful. There's a difference between being a criminal and being successful. Criminals are to be punished, successful aren't.
Posted on Reply
#4
mdm-adph
Easy Rhino said:
and this is where the socialists always go wrong. who dictates what percentage of market share is enough? the government? so are you saying that once you become highly succesful you actually are punished and lose your right to your own property? since when is being good at what you do illegal? remember, a companies job is to make money, not create competition or increase societal progress.
Once again, you left something out. It's not the market share that's the problem, it's what the company does when it gets there.

And please don't start with the whole "socialists" shit again, okay?

Do you remember what American Political party were the first "trust-busters" and went up against big business? If I remember correctly, it was the Republican party, led by Teddy Roosevelt. :laugh:

FordGT90Concept said:
Put simply, you're discriminating against Intel for being successful. There's a difference between being a criminal and being successful. Criminals are to be punished, successful aren't.
Like I've said before, the Mafia are very "successful" at what they do, too. They seem to get compliance from their vendors almost 100% of the time. Not to mention their customer loyalty is unparalleled.
Posted on Reply
#5
Imsochobo
mdm-adph said:
Once again, you left something out. It's not the market share
Like I've said before, the Mafia are very "successful" at what they do, too. They seem to get compliance from their vendors almost 100% of the time. Not to mention their customer loyalty is unparalleled.
Hahaha :D made me laugh :D very impressive line.
Posted on Reply
#6
FordGT90Concept
"I go fast!1!11!1!"
The mafioso organisation isn't illegal (it's more or less a family unit but not necessarily by blood), it's the businesses they partake in (e.g. drug running, doing "favors," and things of the sort). Is Intel running drugs? No. Is Intel extorting businesses at gun point? No. Is Intel assassinating people that get in the way? No. There is no comparison.

The only reason why the mafioso had loyalty is because they got results. If the mafia said you weren't going to get cut from your job, you weren't going to get cut from your job. That doesn't necessarily mean someone wouldn't end up dead over it though. Because of that fact is why they were deemed a hazard to society; however, society lost control over both political and law enforcement processes making it very hard to reestablish government control in cities like Chicago. The mafioso are still around but they have taken up legal trades (like labor unions). Their presence isn't near as prominent as it used to be especially when compared to drug cartels. The main difference between a cartel and mafioso is cartels don't pretend to be innocent.
Posted on Reply
#7
mdm-adph
FordGT90Concept said:
The mafioso organisation isn't illegal (it's more or less a family unit but not necessarily by blood), it's the businesses they partake in (e.g. drug running, doing "favors," and things of the sort). Is Intel running drugs? No. Is Intel extorting businesses at gun point? No. Is Intel assassinating people that get in the way? No. There is no comparison.

The only reason why the mafioso had loyalty is because they got results. If the mafia said you weren't going to get cut from your job, you weren't going to get cut from your job. That doesn't necessarily mean someone wouldn't end up dead over it though.
Whether or not Intel is extorting anyone is still up in the air as far as I'm concerned (at least until the appeals get done) -- and just because they're doing at the end of a business table instead of at the end of a gun doesn't make it any better. There's plenty of room for comparison.

And please don't defend the mafia's excellent job security practices. They have loyalty because they're criminals who tend to dunk people in acid and chop off legs and arms. People are scared of them -- they're criminals. :shadedshu
Posted on Reply
#8
Easy Rhino
Linux Advocate
Imsochobo said:
STOP MISSUNDERSTANDING THE ANTITRUST REASON.

The reason is that intel made rebates or what the word is for it, to not buy amd cpu's, if you bought amd cpu's the intels got more expensive.

Intel had enough money at hand to do this, and make sure their fabs was occupied, and sold enough, made a name....

READ!
http://europa.eu/rapid/pressReleasesAction.do?reference=MEMO/09/235&format=HTML&aged=0&language=EN&guiLanguage=en
we are not misunderstanding the case. we are saying that what intel did is not morally wrong. if a company that sells intel also sells amd, then perhaps intel will lose money. so intel can either INCREASE prices or they can offer rebates to companies as an incentive. basic business.
Posted on Reply
#9
Easy Rhino
Linux Advocate
mdm-adph said:
Once again, you left something out. It's not the market share that's the problem, it's what the company does when it gets there.
it doesnt matter what they do so long as they dont physically force people to buy their products. and obviously you do think it is the market share that is the problem because you would not have brought it up. do you believe intel is exploiting consumers somehow by controlling a certain percentage of the market?
Posted on Reply
#10
FordGT90Concept
"I go fast!1!11!1!"
mdm-adph said:
Whether or not Intel is extorting anyone is still up in the air as far as I'm concerned (at least until the appeals get done) -- and just because they're doing at the end of a business table instead of at the end of a gun doesn't make it any better. There's plenty of room for comparison.

And please don't defend the mafia's excellent job security practices. They have loyalty because they're criminals who tend to dunk people in acid and chop off legs and arms. People are scared of them -- they're criminals. :shadedshu
Intel isn't, and? Their successful. So? I think I'm missing where in here Intel is in the wrong. I guess it just sucks to be the best at what you do.
Posted on Reply
#11
MilkyWay
Of course intel have more powerful cpu but that isnt the reason why it is dominating the market. It was using underhand techniques to gain a market advantage even when it was more profitable and had a bigger market share.

When AMD had the A64 it was a technically better cpu and intel didnt want its OEM sector being bitten into because lets face it without all the offices of the world running intel all it would be is a niche market with performance king nerds buying its cpus.

They are trying to keep nvidia out of the game too so tell me what about that you dont understand?

Im not saying this because i have an AMD cpu, i am saying it because its fact they used underhand tactics and they got fined.

You cant do things like this and say oh its competitiveness we have to do anything we can to stay at the top, because then it will start to spread to other areas other companies might start to get dirty and it might spread out of just business.

IF when i was younger my gran said give half to your sister and gave you £20 but you could just keep it all would you? Its like that.
Posted on Reply
#12
MilkyWay
Easy Rhino said:
it doesnt matter what they do so long as they dont physically force people to buy their products. and obviously you do think it is the market share that is the problem because you would not have brought it up. do you believe intel is exploiting consumers somehow by controlling a certain percentage of the market?
not becasue its got a huge market share its because of why it has a huge market share!
your defending bad practise so why dont you defend google or microsoft?

why would there even be a case if it was okay to do things like that?
Posted on Reply
#13
mdm-adph
FordGT90Concept said:
Intel isn't, and? Their successful. So? I think I'm missing where in here Intel is in the wrong. I guess it just sucks to be the best at what you do.
Yeah, that's what it is. That's why Mark McGwire isn't getting into the Hall of Fame -- because he's the best.

It wasn't because he stuffed his veins full of steroids. :shadedshu

That's it -- I honestly give up. If you don't believe that cheating is wrong, or that you can't even decide upon a definition of what cheating is, there's nothing I can do.

There are two types of people in this world -- there are those that like to play fair, and there are Michael Douglass Wall Street types who think that "Greed is a Virtue" and that anything you do to get ahead is okay, since in the end you have the most money and "might makes right."

If you want to be like that, just admit it, okay? :banghead:
Posted on Reply
#14
Steevo
Easy Rhino said:
we are not misunderstanding the case. we are saying that what intel did is not morally wrong. if a company that sells intel also sells amd, then perhaps intel will lose money. so intel can either INCREASE prices or they can offer rebates to companies as an incentive. basic business.
Intel also paid clients to delay or not launch computers incorporating a competitor's CPUs, a conduct which is not linked at all to a company's ability to provide customers with discounts.


So paying a company CEO like Dell to NOT sell AMD is illegal and caused a loss of choice to the main customer base.

What is hard to understand about this. AMD is not getting a penny from this, other than the right to compete fairly with Intel. No more bribes, no more threats.
Posted on Reply
#15
MilkyWay
Steevo said:


So paying a company CEO like Dell to NOT sell AMD is illegal and caused a loss of choice to the main customer base.

What is hard to understand about this. AMD is not getting a penny from this, other than the right to compete fairly with Intel. No more bribes, no more threats.
that is a fair way to put it, i only hope they use the fine money for a good use!


AMD cant compete because Intel is taking all the business not by popular choice but by underhand tactics like secret deals to large companies, price cuts for certain places, long term relationships.

All that the EU wants is a fairer marketplace that consumer choice will regulate.
Its like Betamax and HD DVD consumer choice won out those times.

If a business chooses not to sell a certain brand or product on its own that is okay but for a competitor to come and go dont sell our competitors products and we will make it worth your while! That is wrong.
Intel even have a hand in macs now.
Intel are trying to stop nvidia attaining a license for making cpus becasue it dosnt want another competitor in the market.
Posted on Reply
#16
extrasalty
Probably not the best place to do my first post but here it goes...
It's pretty entertaining to read all the reactions to the fine. It's obvious that some people have not made the effort to understand why this fine was imposed. The biggest reason in my opinion is the readers age.
There is nothing wrong with Intel offering rebates and incentives. It is entirely different to offer those on the condition to delay or cancel development of competitive products, or to use "shortages" for the OEMs and retailers that don't play along.
This fine is not about who has or had the superior product- both companies had their moments- it's about who got caught breaking the law. Intel have a legal department the size of the entire AMD. Their budget is probably bigger than AMD' R&D. They even have insurance against loses such like the fine. Do you think they didn't do cost-benefit analysis?? They knew a lawsuit will take years- spread the fine over 10 years and it's only 100 mil per year. Intel are probably laughing all the way to the bank that the fine is way lower than the max 10% of their yearly revenue. People should stop with the emotions and fanboism and get the facts straight:
1. Intel willingly and knowingly broke the law worldwide.
2. They got caught.
Whether Nehalem or Penrynn whoops Phenoms' collective arses is irrelevant.
Whether you like to label people as socialists, fascists or don't agree with government is irrelevant.
Posted on Reply
#17
FordGT90Concept
"I go fast!1!11!1!"
mdm-adph said:
Yeah, that's what it is. That's why Mark McGwire isn't getting into the Hall of Fame -- because he's the best.

It wasn't because he stuffed his veins full of steroids. :shadedshu
Yeah, he's gonna die of stroke by the age of 60 but, so? Who is he hurting by doing that besides himself? The only reason why they ban drugs like steroids is to prevent the entire league from getting drugged. That's a different debate though and not exactly one I care about either (baseball = blah).



mdm-adph said:
That's it -- I honestly give up. If you don't believe that cheating is wrong, or that you can't even decide upon a definition of what cheating is, there's nothing I can do.
The only thing I consider "cheating" in the business world is buying out competitors (ehm, hostile takeover). Everything else is regulated by the judicial system (business made contract with a customer and broke it, visa versa, and other disputes of the like) and/or customers (your product/customer service/business tactics suck, I won't support you).
Posted on Reply
#18
TheMailMan78
Big Member
mdm-adph said:

How convenient for me -- I can cook your 25-core pastry processor on top of my old Pentium D. :D
Now your just being ridiculous.

Anyway on topic I would really love to debate and destroy you all on this but I think its not about Intel vs The EU and what happen. I think this thread is becoming an America vs Europe thread. There is a lot if hate towards the US right now and this EU ruling just seems to bring out the "We stuck it to the man" kinda people. I really don't want to fuel that fire. IF thats the case. Its not good for anyone.
Posted on Reply
#21
Easy Rhino
Linux Advocate
MilkyWay said:
not becasue its got a huge market share its because of why it has a huge market share!
your defending bad practise so why dont you defend google or microsoft?

why would there even be a case if it was okay to do things like that?
it isnt bad business practice to entice your clients with rebates and lower prices on your products in exchange for them dropping the competition. why would you favor AMD in this case who is backed by the EU? people are so quick to point out how intel is going about their business BUT NOBODY HAS MENTIONED HOW AMD USES THE EU TO ADVANCE ITS FORTUNE.
Posted on Reply
#22
Easy Rhino
Linux Advocate
Steevo said:
What is hard to understand about this. AMD is not getting a penny from this, other than the right to compete fairly with Intel. No more bribes, no more threats.
does the right to compete fairly include Eu dropping their billions in support of Silicon Saxony and AMD?
Posted on Reply
#23
IcrushitI
W1zzard said:
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.
And to top it off their is no punishment for Intel or any other outfit from the USA (just a reminder) in the USA all fines are classified as a business right off. What incentive is there to stop. When the US taxpayers bitch about their taxes going up to support outfits like this and government revenue goes down will you see some pressure on this side of the pond. But then again will it ever stop. When you have a system where a politician cries out: "Please I'll kiss anybodys ass for political contributions, I need to get re-elected.":pimp:
Posted on Reply
#24
TheMailMan78
Big Member
Ill say it again.....

America Rulz! EU Suxorz!!1!!

I mean thats where all this is going to go..... OR

EU Rulz! America Suxorz!!1!!
Posted on Reply
#25
Steevo
Easy Rhino said:
does the right to compete fairly include Eu dropping their billions in support of Silicon Saxony and AMD?
Are they preventing Intel from going there? Nope.

Did Intel prevent AMD from selling to major chains, thus forcing the hand of the majority purchasing a PC to have only one option, aka a monopoly. Yep.



Seems clear cut to me.


Provide proof of EU dropping "billions" to support AMD. as far as I know AMD has chosen the Dresden facility as they don't have the money to really have all their own production done in house. And as I remember they sought outside funding from private parties to do so.

AKA Put up or shut up.
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