Report: Intel-McAfee deal could drag out in EU

EU antitrust regulators are concerned about chip giant's plan to bake security directly into processors, a development that could slow the completion of Intel's biggest-ever buyout.

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Edward Moyer is a senior editor at CNET and a many-year veteran of the writing and editing world. He enjoys taking sentences apart and putting them back together. He also likes making them from scratch. ¶ For nearly a quarter of a century, he's edited and written stories about various aspects of the technology world, from the US National Security Agency's controversial spying techniques to historic NASA space missions to 3D-printed works of fine art. Before that, he wrote about movies, musicians, artists and subcultures.
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European antitrust regulators have privately expressed concern over Intel's buyout of security-software maker McAfee, according to a report, a development that could slow the completion of the chipmaker's biggest-ever acquisition.

Citing unnamed sources, as well as a questionnaire reportedly being circulated by European Union investigators, The Wall Street Journal said a preliminary review of the deal has raised concern about Intel's plan to engineer security features directly into its chips.

Regulators have reportedly been asking rival security-software companies about the possibility of Intel giving McAfee products exclusive or special access to some chip features, thus enabling the products to run more effectively than competitors' offerings.

The concerns could lead to a lengthier study of the deal's implications, the Journal said, adding that the EU has until January 12 to issue a judgment on the acquisition or launch the more-extended review. In mid-October, the Journal reported, Intel said the deal could wrap up as early as the end of this year or in the first quarter. Now, however, the chipmaker is speaking of the first half of 2011 as its time frame.

Intel announced the $7.68 billion buyout in August, saying that with the advent of more and more Internet-connected technologies, security had become as important a consideration in computing as connectivity and energy-efficient performance. The company says McAfee's core technology could help it address the issue.

"Hardware-enhanced security will lead to breakthroughs in effectively countering the increasingly sophisticated threats of today and tomorrow," Intel Senior Vice President Renee James said in a statement at the time.

The EU and Intel have had their differences before. In May of last year, the European Commission slapped the chipmaker with a $1.45 billion fine for violating antitrust legislation, after complaints from Intel rival Advanced Micro Devices led to an investigation. Intel said the Commission's findings were erroneous and appealed the fine.

Neither Intel, McAfee, nor the European Commission had any comment for the Journal on this latest report.