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Intel and AMD comment on EC ruling

Carol Ko | May 14, 2009
Intel will appeal, said Intel's CEO

HONG KONG, 14 MAY 2009 Paul Otellini, president and chief executive officer of Intel, has responded to the European Commission's decision to fine the US chipmaker, charging it of violating antitrust rules.

Otellini said: Intel takes strong exception to this decision. We believe the decision is wrong and ignores the reality of a highly competitive microprocessor marketplace characterised by constant innovation, improved product performance and lower prices. There has been absolutely zero harm to consumers. Intel will appeal.

The European Commission found Intel guilty of abusing its dominant position in the global x86 microprocessor market, saying that Intel has harmed millions of European consumers by deliberately acting to keep competitors out of the market for computer chips for many years. Such a serious and sustained violation of the EU's antitrust rules cannot be tolerated.

The Commission also stated that there is evidence that Intel had sought to conceal the conditions associated with its payments. The EC decision requires Intel to change its business practices immediately and fines Intel a record 1.06 billion euros (US$1.45 billion).

The European Commission drives the European Union's institutional system, responsible for enforcing the European Community law (jointly with the Court of Justice) and negotiating international agreements, mainly those relating to trade and cooperation.

Intel: competitive market

Otellini added: 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, he continued.

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, said Otellini.

AMD: consumers were hurt

In response to EU's ruling, Dirk Meyer, president and CEO of AMD, US' second largest chip maker, said it is an important step towards establishing a truly competitive market.


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