Aces High Bulletin Board
General Forums => Hardware and Software => Topic started by: Denholm on May 15, 2009, 06:45:09 PM
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On Wednesday May the 13th of 2009 the European Commission fined Intel €1.06 Billion ($1.45 Billion) for bribing computer makers to postpone or cancel plans to launch products featuring AMD chips, paying illegal rebates in secret, and paying major retailers to stock only computers with Intel chips.
In short, Intel was fined for having a monopoly.
http://www.foxbusiness.com/story/markets/industries/technology/intel-appeal--billion-fine/
In a way I think it's great, in others I think it will hit the consumer. If the fine sticks, this is the break AMD needed.
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Dirty dirty dirty if it's true.
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OWNED!
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I believe Intel was using its larger share of the market to price competition out of the running and I dont see that they were 'paying businesses to only stock Intel' but I guess it could be interpreted that way. Sounds more like picking sides than it does justice.
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I believe Intel was using its larger share of the market to price competition out of the running and I dont see that they were 'paying businesses to only stock Intel' but I guess it could be interpreted that way. Sounds more like picking sides than it does justice.
Wrong,
Here is part of the press release from the commission -
Intel gave rebates to computer manufacturer A from December 2002 to December 2005 conditional on this manufacturer purchasing exclusively Intel CPUs
Intel gave rebates to computer manufacturer B from November 2002 to May 2005 conditional on this manufacturer purchasing no less than 95% of its CPU needs for its business desktop computers from Intel (the remaining 5% that computer manufacturer B could purchase from rival chip maker AMD was then subject to further restrictive conditions set out below)
Intel gave rebates to computer manufacturer C from October 2002 to November 2005 conditional on this manufacturer purchasing no less than 80% of its CPU needs for its desktop and notebook computers from Intel
Intel gave rebates to computer manufacturer D in 2007 conditional on this manufacturer purchasing its CPU needs for its notebook computers exclusively from Intel.
Furthermore, Intel made payments to major retailer Media Saturn Holding from October 2002 to December 2007 on condition that it exclusively sold Intel-based PCs in all countries in which Media Saturn Holding is active.
A, B, C and D are widely regarded as being Dell. HP, NEC. Lenovo, Acer (not neccessarily in that order).
The commission seen nothing wrong with rebates, Intel can continue to give them, however they may not attach such conditions to them.
Press release here -
http://europa.eu/rapid/pressReleasesAction.do?reference=IP/09/745&format=HTML&language=en (http://europa.eu/rapid/pressReleasesAction.do?reference=IP/09/745&format=HTML&language=en)
You can read the true extent of Intels tactics.
Bear in mind this is now the third country to find Intel guilty, with the U.S. likely to be the next.
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So far you have a press release and a court judgment and in todays world neither one alone or together is proof of any wrong doing (hate to say it actually). I dont see anything wrong with a price structure like the one Intel suggested.
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Surely you can see the difference between -
a) I will give you a 20% discount.
and
b) I will give you a 20% discount but you may not use any competitors products.
As the E.U. is now the third country to find Intel guilty, I would suggest there is more than enough evidence to show it.
As the U.S. and E.U. shared information on this, whats the odds that Intel aren't that far away from a 4th guilty verdict (in the U.S.), plus perhaps the biggest fine of all.
The fallout from it all should prove to be interesting.
[edit]As for proof - from the release:
"The Commission obtained proof of the existence of many of the conditions found to be illegal in the antitrust decision even though they were not made explicit in Intel’s contracts. Such proof is based on a broad range of contemporaneous evidence such as e-mails obtained inter alia from unannounced on-site inspections, in responses to formal requests for information and in a number of formal statements made to the Commission by the other companies concerned. In addition, there is evidence that Intel had sought to conceal the conditions associated with its payments."
Not only they have proof, but Intel attempted to hide the truth, i.e. the mysterious lost/accidently destroyed emails.
Looks like a duck, walks like a duck, quacks like duck - ................?
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Intel should call Bill Gates on how to side slip such things.
(http://img35.imageshack.us/img35/7899/billgateze0.gif) (http://img35.imageshack.us/my.php?image=billgateze0.gif)
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EU just hit an American company with a 1.45B tax and you think that is great? What am I missing? Maybe you want the company destroyed and put out of business? That would be great huh? We could have the Government take it over like everything else? Maybe you want them to wind up like GM or Chrysler and we would be stuck with crappy AMD processors?
Let us know what your hopes are for all the intel workers. Maybe we could get them jobs running the Union of California Socialists Republic which is bleeding the rest of the country dry.
Infidelz.
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Since when is a conditional price illegal?
My local store has a price club. I can buy 1 pack of cookies, or buy 2 and the second is free. But that does NOT mean the first one is half off. It's conditioned on the purchase of 2 packs.
So I go to ANY number of places online or in person, and they have discounts based on bulk purchases. You buy 1, and it's full price... you buy 10 it's full price.... But maybe you buy 1000, you get 20% off (major savings, mind you).
It's NOT illegal to put conditions on rebates or discounts. In fact it's the way every company in America works about now, to one degree or another.
Pretty thin "proof" if ya ask me.
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and we would be stuck with crappy AMD processors?
Err the P4 series was a pretty awful processor, the AMD's ran rings around it. If AMD drop out intel will go back to it's old ways, crap cpu's at high prices.
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It's NOT illegal to put conditions on rebates or discounts.
It is if you're in a dominant marketing position and the conditions are about selling a competing product. As the article said the rebates are not the culprit, the use of capital to force the competition out of the market is.
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So you say to somebody "You know what? You buy only my stuff, I give you a big discount!" and that's illegal?
Taking NO consideration of the SIZE of the vendors, there's no monopoly unless they do that with ALL vendors. In a case by case basis, there is nothing inherrently wrong doing this. It's just a business deal.
Now if they say "do this or else we shut you down with every business partner we ever know or ever will" then it's monopoly. If you threaten something bad in the event the companies don't buy your stuff, that's bad.
One's a threat, one's a reward.
Rewards are not mandatory, are offered as a sweetener to a deal.
You ask me the only reason this is an issue is Intel still has deep pockets. ANY other company and this would never have come up (except in the entire EU, cash starved and doing even worse than the USA right now, if you can believe it).
I say this objectively. I'm no giant Intel fan, other than loving the c2d chips they put out. I like competition between them and AMD for the already-specified reasons in this thread
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So you say to somebody "You know what? You buy only my stuff, I give you a big discount!" and that's illegal?
Depends, if you sell it below a profitable level with the intent of destroying your competitor so that later you can dominate the market then yes. I believe the term is predatory pricing.
I wouldn't get all high and mighty about the EU either, the USA squeels loud enough when it think's someone's doing something shifty to their markets (steel, grain, etc).
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Yep it's very common for a company that's in a dominant position to misuse that position by underpricing or giving away their products with the intent of killing away the competition. Once the competition has been forced out of the market the monopole can price the products as they wish and cut down r&d costs.
So this hurts both the consumers and business - consumers get no selection and a stagnant development and business hurts when competing companies can't get a foothold. Which is why this kind of stuff has been made illegal.
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I dont think so I think this is just a way for the EU to get a larger piece of Intels profits. Fining someone a billion dollars is utterly ridiculous.
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I dont think so I think this is just a way for the EU to get a larger piece of Intels profits. Fining someone a billion dollars is utterly ridiculous.
Umm.. so you think fining them 29.99 with free shipping would make them change their illegal pricing? :rolleyes:
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I dont think so I think this is just a way for the EU to get a larger piece of Intels profits. Fining someone a billion dollars is utterly ridiculous.
How old are you? Seriously - because if you'd been exposed to the cpu market for a period of time you'd know that there's more to this than you realize. I've been in IT for 23 or so years now, Intel have a history of raping us over processors unless absolutely forced too by competition. Do you remember the P4? RAMBUS? The relabeled P3's? The 8088 vs 8086, the SX's?
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Since when is a conditional price illegal?
My local store has a price club. I can buy 1 pack of cookies, or buy 2 and the second is free. But that does NOT mean the first one is half off. It's conditioned on the purchase of 2 packs.
Not a correct comparison. You are not limited to buying that brand of cookies only.
Rebates are not illegal, the conditions on them were.
Part of the press release states -
AMD offered one company one million (with an m) FREE CPU's. Obviously they get revenue back from builds etc. But the company were only able to accept 160,000 AMD CPU's or they would lose their rebate with Intel.
@Infidelz - I guess it will be OK then when Intel are fined by their own government (maybe 2010) for exactly the same practises?
a) Japan - Finds them guilty, no fine but a very clear "change you business practises" message to them.
b) Korea - Finds them guilty, fines them 26m dollars.
c) EU - Finds them guilty, fines them 1b euros.
d) US - ?????????????
e) Possibly Australia
Everyone else is wrong, Intel is right?
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No one here, or anywhere for that matter, will ever know the entire truth behind all this. Intel claims they have refuting documentation which they were not allowed to enter as evidence. No one has any idea if this is actually true.
It could all be a matter of politics. It could all stem from a hatred of America. It could be the phase of the moon. It could all be based on greed, on all sides.
I do know one thing. It seems to have further polarized people in the AMD and Intel camps.
With that said, I caution everyone participating in this thread to leave any emotional baggage at the door. Afterall, no one here actually knows the truth, and no one ever will. If you think you really know what is going on, then you are just a willing participant in this well scripted drama.
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No one here, or anywhere for that matter, will ever know the entire truth behind all this. Intel claims they have refuting documentation which they were not allowed to enter as evidence. No one has any idea if this is actually true.
It could all be a matter of politics. It could all stem from a hatred of America. It could be the phase of the moon. It could all be based on greed, on all sides.
I do know one thing. It seems to have further polarized people in the AMD and Intel camps.
With that said, I caution everyone participating in this thread to leave any emotional baggage at the door. Afterall, no one here actually knows the truth, and no one ever will. If you think you really know what is going on, then you are just a willing participant in this well scripted drama.
Skuzzy must have had the "Good Coffee this morning :D .South Pacific blend or Dark Roast? lol......
as for Intel and being fined in the US, well they just gonna cop a deal with the US Government, like MS did........
The movie industry is not just making up these movies:
enemy of the State
Conspiracy Theory ( not the Mel Gibson movie---this is the original 1st script of Eagle eye )
Eagle Eye
Echolon is real :devil
http://www.tgdaily.com/content/view/39455/128/
:noid
back on topic: here is another link to a report of Intel being fined/accused that tells a little more........
http://www.tgdaily.com/content/view/42431/119/
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Nah, I just know this crowd well enough to know it will become a link war and nothing more.
At the end of the day, no one will still know the truth.
None of this is new. My Grandfather started his auto parts business in 1954, and within days was offered deals only if he would carry that line. It was all over the map. At the end of the day, he chose the companies which offered the most marketing and advertising dollars. It served to make his business very successful.
Deals like that went on thoughout the history of his company. It finally ended when Dad retired and closed the business a few years ago.
Why is it ok for the business owners to support these tactics, but not ok for the businesses to instigate these practices? It's a rhetorical question. Again, no one will ever really know what happened here and you are just fooling yourself if you think you do.
Go ahead with your link war. Just leave the personal stuff at the door.
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ahhh shucks Skuzzy I was just funnin around.........is all a joke to me, others can play war if they like.........isnt for me though :)
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True Skuzzy. I am a heavy investor in Intel and I am probably overfed with propaganda but I also add to that the anti-American sentiment I see everyday from the EU and... well I already said what I think and I will only add that hating large profitable corporations is nothing new.
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Jeez, I hate to break the news but exclusive distribution arrangements exist throughout the business world. I'm curious what makes this one so special.
According to the Robinson Patman act you can't offer a price (or deal) to one customer that you don't offer to all customers in a similar class, although that's a U.S. law and, I would think, extending the same offer to all customers would put you in compliance. Even offering several similar deals would be ok as long as they were all offered to all customers. That doesn't even contemplate the class of trade issue which can be a grey area. Regardless, there's a lot of rule bending going on out there in the real world.
Also, I don't think that the U.S. predetory pricing laws (or minimum mark-up laws as they are sometimes referred to) apply outside of the retail environment but I could be wrong.
Anyway, I've sat through enough back-room deals in my career that I'm not at all surprised. In fact I have to sort of tip my hat to Intel for negotiating these deals. I wish I'd been a fly on the wall. I am however, surprised at the severity of the fine.
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Echolon is real :devil
http://www.tgdaily.com/content/view/39455/128/
Thats not echelon, we have two well documented echelon sites in NZ, probably the worst kept secrets ever.
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Skuzzys right.
Certain sites forums have gone hysterical over this.
For the moment pending appeals Intel is guilty, in the E.U., Korea, and Japan.
A few points of discussion though -
a) Is it right to punish current Intel for practises carried out by a previous 'board'?
b) If not how do you prevent any company from breaking laws in the future if you don't catch them until years later?
c) Does this open the doors to AMD for compensation lawsuits?
d) Should the companies involved be fined also for being complicit (Dell, HP, etc), or did they have 'no choice'?
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Is the Billion dollar fine possibly because the EU case against Microsoft taught the EU beurocrats that the best way to deal with a successful U.S. technology giant, if they want a chance to get anything, is to kick them in their successful BIG nads with the biggest boot in the arsenal? Intel and Microsoft both need to play in the EU. Microsoft got sued by the EU for not being open source. A Billion dollars is not the same as punishing Intel by requiring them to hand over proprietairy technology to a EU company for a level playing feild. Sounds like someone else and Fiat. :lol
Maybe AMD gave the EU beurocrats a good whoopiee deal under the table to slow Intel down for them. From some perspectives, going after Intel is finishing the job started with Microsoft over monopolies. I was always told when Micrsoft uses the jon, Intel brings the TP.
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I find rather funny to see how some hurry waving their flag with such chauvinism.
Intel didn't follow the rules and so is punished<period>.
You can't just take the money and forget the rules.Had Intel made some drug traffic will you have the same attitude ?
True Skuzzy. I am a heavy investor in Intel and I am probably overfed with propaganda but I also add to that the anti-American sentiment I see everyday from the EU and... well I already said what I think and I will only add that hating large profitable corporations is nothing new.
That's pure nonsense like thinking I'm burning an US flag each morning.
Btw if you've invested only in Intel it's perhaps time to diversify your portfolio ,but no hurry as currently the fine as no impact on the market.
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I dont think so straffo. The EU is not an exception when it comes to wanting their share of trade agreements and Intel is making money hand over fist its only natural for the 'protection racquet' to come around for more 'insurance money.' The process we see unfolding here is how the cockroaches do business in the light as it were. Intels customers could have just said no and gone with both processor types but the profit margin speaks louder than product diversity and there is nothing wrong with that. So now you can see I think this is nothing like real restraint of trade or 'antitrust' but obviously someone in the EU feels the pricing structure reached the level of 'predatory pricing' which is the same thing as outsiders telling business how much they can charge and how much they can make and I never like that.
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Does Europe even have a competitor in that market? I don't see how anyone would benefit from this other than AMD and consumers. I'm not exactly familiar with the market, though...
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Socialism at its finest, American companies should take a real long look at this because were on our way to a socialist society. Government will punish companies that are doing well to prop up the ones the government deems uncompetetive. say goodbye to the free market system weve enjoyed for so long.
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I'm with you, Motherland. I don't think Europe has a competitor in the same market as Intel. Then again, I'm not very informed when it comes to these companies.
I do however believe the fine will do some good. While I'm not accepting the accusations as truth, I was suspecting something of the sort was possibly happening. I really did not want to see AMD die, as they are the only true competition against Intel.
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Rather take a long hard look at our court systems over the last 100 years. The 'antitrust' cases have long since gone the way of the 'robber barons' and over the last sixteen years the move has been in favor of monopoly-like powers and big business. There hasnt been a power struggle over monopolies for some time because the economy 'usually' is self-corrective in that way. If you think back to the last monopoly in recent memory (telephone) innovation was stifled and progress was frozen. The public could not force the company to break up but the government did and that was good for innovation and progress. That would be an extreme example of a monopoly realized rather than a monopoly perceived as in the case of Intels intent seen in 'predatory pricing.'
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I'm looking at it from the window of AMD and Intel being the major manufacturers in the processor market. If AMD went under, there wouldn't be anyone else with the funds to compete against Intel. In my opinion, that would be a monopoly. Not only would Intel be on top, they could control the price of their products without anyone else being able to do much about it.
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I think your reading way too much into this and no I dont think AMD is in danger of going under because of anything Intel has done but very much in danger of going under because of their own business decisions and poor performance. Intel will be going to court again here in the U.S. but I doubt anything will come of it because it will be very hard to prove harm to U.S. customers due to lower prices having been offered to computer manufacturers.
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Actually I only saw a 30-second news story on this and the news article I posted on the top of this thread. So no, I haven't been reading too much on this issue.
Yes, I was looking at it from the perspective if AMD did go under because Intel managed to force them out. However, at the moment I don't believe AMD is in danger of going under because of Intel. If AMD did go under, the effects will be noticed within 365 & 1/4 days.
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Socialism at its finest, American companies should take a real long look at this because were on our way to a socialist society. Government will punish companies that are doing well to prop up the ones the government deems uncompetetive. say goodbye to the free market system weve enjoyed for so long.
You do realize your country has been repeatedly smacked for doing this to prop up failing industries in the US that can't compete with international trade (steel, beef, lamb, forestry markets)? Not saying it's a bad thing, just you need to be aware that your perception of the USA being 'free market system' is a load of cobblers.
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America is the center of the financial world today because of the genius of one man and Americas 'free market system.' It may be true that regulation is restricting a great deal of freedom within the market (and that is played out in the EU frequently) but it is also true that a return to the consolidation of large companies (mergers) has led to a great deal of advancements and progress. The 'money trust' system of 100 years ago should never have been replaced by the federal reserve system we have today. As we are now seeing the current system only works if competent management is in place (which today it is not) but the old system could only have competent management because anything less would lose to the more successful (a true dog eat dog world).
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and Americas 'free market system.'
Dude, seriously, Russia is more free market than the USA.
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Russias 'free-market' consists of raw materials (resources) and none of the government-owned industries export anything outside of arms and munitions and imports include all the 'essentials' like refrigerators and automobiles. Compare that with a market that allows relocation for labor or tax advantage. Yes I see the American system as over-regulated and restrained certainly but it is still a much better example of 'free-market.'
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Russias 'free-market' consists of raw materials (resources) and none of the government-owned industries export anything outside of arms and munitions and imports include all the 'essentials' like refrigerators and automobiles. Compare that with a market that allows relocation for labor or tax advantage. Yes I see the American system as over-regulated and restrained certainly but it is still a much better example of 'free-market.'
Bailouts, import tarrifs, subsidies... yeah free market :D
Don't get me wrong, I think it is a responsible thing for a govt to do (to an extent). But I just think you are delusional if you think the USA is an open free market.
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America is the center of the financial world today because of the genius of one man and Americas 'free market system.' It may be true that regulation is restricting a great deal of freedom within the market (and that is played out in the EU frequently) but it is also true that a return to the consolidation of large companies (mergers) has led to a great deal of advancements and progress. The 'money trust' system of 100 years ago should never have been replaced by the federal reserve system we have today. As we are now seeing the current system only works if competent management is in place (which today it is not) but the old system could only have competent management because anything less would lose to the more successful (a true dog eat dog world).
I beg to differ I think that WWII had a huge influence on how prominent are the USA today,not the free market.
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Ok, this is exactly what I was concerned about. It has turned into a political discussion.
See Rule #14 folks.