Inside AMD's complaint against Intel

NETWORK WORLD NEWSLETTER: DENI CONNOR ON SERVERS
07/07/05
Today's focus: Inside AMD's complaint against Intel

Dear networking.world@gmail.com,

In this issue:

* AMD takes on Intel
* Links related to Servers
* Featured reader resource
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Today's focus: Inside AMD's complaint against Intel

By Deni Connor

AMD last week filed an anti-trust suit against Intel in a move
that surprised very few in the industry.

The suit, filed in the U.S. District Court for the District of
Delaware, alleges that "for over a decade, Intel has unlawfully
maintained its monopoly by engaging in a relentless, worldwide
campaign to coerce customers to refrain from dealing with AMD."
AMD charges that Intel's conduct is "increasingly egregious" as
AMD "has achieved technological leadership in critical aspects
of the microprocessor architecture."

The 48-page complaint lists 38 companies - including HP, IBM and
Dell - that AMD claims have been coerced by Intel.

AMD says Intel's market share counts for 80% of worldwide sales
by unit volume of x86 processors and 90% by revenue, thus making
it a monopoly.

AMD's suit is bolstered by a recent decision of the Fair Trade
Commission of Japan, which found that Intel abused its monopoly
power and violated Japan's Antimonopoly Act. The European
Commission is also pursuing an investigation against Intel for
similar anti-trust violations.

AMD alleges that once it began taking market share away from
Intel, Intel initiated illegal tactics against the company.

According to the complaint, Dell, Gateway and others have
accepted cash payments and marketing subsidies to deal
exclusively with Intel. When AMD got on HP's roadmap for mobile
computers, Intel withheld HP's fourth-quarter 2004 rebate check.
Intel threatened retaliation against customers who considered
adopting AMD processors. 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," Capellas told AMD he had to stop buying processors
from AMD.

The case, which could go to trial in late 2006, will depend on
Intel's ability to show how its marketing practices benefited
customers. Intel says it disagrees with the AMD suit and will
not change its practices.

It is not the first lawsuit between Intel and AMD. The two
companies have been involved in five suits over the past 25
years. In 1991, AMD sued for anti-trust violations. In 1995, the
two companies agreed to settle all litigation.

Will AMD's suit against Intel be successful, or will it incur no
more than a slap on the wrist for Intel? Will the U.S.
government get involved like it did with Microsoft? Will any
executives from IBM, HP or Dell step up to AMD's defense?

Let me know what you think. You can read the complaint at:
<http://www.amd.com/breakfree>

As always, my e-mail address is <mailto:dconnor@nww.com>

RELATED EDITORIAL LINKS

Intel disagrees with AMD suit, won't change
IDG News Service, 06/30/05
http://www.networkworld.com/news/2005/063005-intel-amd.html?rl

AMD urges users to read its anti-trust complaint
IDG News Service, 06/29/05
http://www.networkworld.com/nlservers3049

AMD leaves Lenovo out of anti-trust complaint
IDG News Service, 06/29/05
http://www.networkworld.com/news/2005/062905-amd-lenovo.html?rl

AMD files broad anti-trust suit against Intel
IDG News Service, 06/28/05
http://www.networkworld.com/news/2005/062805-amd-intel.html?rl
_______________________________________________________________
To contact: Deni Connor

Deni Connor is a Senior Editor at Network World covering
storage, Unix, Novell, Macintosh and IT in Healthcare. You can
reach her at <mailto:dconnor@nww.com>.
_______________________________________________________________
This newsletter is sponsored by Nokia
Empower Your Mobile Enterprise

Nokia believes that business mobility will fundamentally change
the way work gets done-and for the better. To allow the entire
organization to get the most from this paradigm shift in
productivity, Nokia Enterprise Solutions focuses on delivering
increased efficiency through enhanced mobility. Learn more by
downloading this white paper today!
http://www.fattail.com/redir/redirect.asp?CID=107723
_______________________________________________________________
ARCHIVE LINKS

Archive of the Servers newsletter:
http://www.networkworld.com/newsletters/servers/index.html

Servers/Desktop Research Center:
http://www.networkworld.com/topics/servers-desktops.html
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Here's a ten step guide you can follow to curb the spyware
problem:
<http://www.networkworld.com/nlservers3050>
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