Poll: Is the EU decision against Intel fair?

The question of whether Intel engages in abusive market behavior has been answered by the EU. Or has it?

Updated at 12:45 p.m. PDT: adding AMD statement.

The question of whether Intel engages in abusive market behavior has been answered by the European Commission. Or has it?

CNET News Poll

Market dynamics
Does Intel really abuse its market position?

Yes, definitely.
No, it's just a competitive market.
Who cares? Everyone engages in bad behavior sometimes.



View results

To recap, the EC said:

"Intel limited consumer choice and stifled innovation by preventing innovative products for which there was a consumer demand from reaching end customers."

And: "Intel gave wholly or partially hidden rebates to computer manufacturers on condition that they bought all, or almost all, their x86 central processing units (CPUs) from Intel. Intel also made direct payments to a major retailer on condition it stock only computers with Intel x86 CPUs. Second, Intel made direct payments to computer manufacturers to halt or delay the launch of specific products containing a competitor's x86 CPUs and to limit the sales channels available to these products."

Advanced Micro Devices enthusiastically joins the EC decision, which may "open the floodgates" for civil suits, according to reports. (The fine is paid to the European Commission, not the company that allegedly suffered the damage.)

Though AMD has made it clear that "focusing on the current market dynamics misses the fundamental point of the EC findings" (the period in question for the EU decision is October 2002 through December 2007 and covers servers, desktops, and mobile), looking at current competitive dynamics between Intel and AMD does serve to show that there may be other factors in play.

Intel, for instance, usually takes between 85 percent and 90 percent of the total mobile market share, ( though AMD did gain some ground in the first quarter of this year, according to IDC ) and Intel virtually owns the newest mobile segment--Netbooks, where AMD is not even a player, by its own choice.

Intel mobile processors usually best AMD mobile processors in benchmarks and power efficiency, and this is validated by Intel's standing at first-tier PC suppliers, where AMD is conspicuously absent or barely present in many mobile lineups.

So, are AMD processors absent or underrepresented because of Intel's alleged big stick, or for other reasons? Apple uses no AMD processors. But Apple prides itself on calling the shots--and is certainly Intel's equal in market power. (No Intel stickers and no Intel market development funds for Apple). And it's safe to say that brass-knuckles negotiating is certainly not a tactic exclusive to Intel. (Remember, Apple dumped Intel graphics silicon in favor of Nvidia in the newest MacBooks).

And other first-tier PC makers like Sony and Dell offer (or have offered) only a few AMD-based laptops. Is this because Intel is a bully or does it have more to do with AMD's competitive standing?

Best Buy statistics underscore this lopsidedness. The largest retailer in the U.S. currently lists on its Web site 81 Intel-based mobile SKUs (models) and only 13 models that use AMD processors.

Finally, remember that we're not including graphics chips from AMD's ATI unit. These chips compete for desktop and laptop circuit board real estate with Nvidia and Intel's integrated graphics silicon.

About the author

Brooke Crothers writes about mobile computer systems, including laptops, tablets, smartphones: how they define the computing experience and the hardware that makes them tick. He has served as an editor at large at CNET News and a contributing reporter to The New York Times' Bits and Technology sections. His interest in things small began when living in Tokyo in a very small apartment for a very long time.

 

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