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By | Tony Smith 1st April 2005 09:02

Intel heeds Japanese antitrust probe warning

But denies accusations

Intel has agreed to abide by the recommendations of Japan's Fair Trade Commission (JFTC), the chip giant said yesterday, though it maintains that the accusations of anti-competitive behaviour levelled against it are false.

It also accused the JFTC of "misrepresenting" its business practices and failing "to take into account the competitive environment within which Intel and its customers compete", which sounds a little like "the ends justifies the means".

In a statement, Intel said it agrees with neither the "facts underlying the JFTC's allegations" nor the "application of law" that led to the JFTC's recommendation.

However, "in order to continue to focus on the needs of customers and consumers, and [to] continue to provide them with the best products and service, we have decided to accept the recommendation", Bruce Sewell, Intel's general counsel said.

On 8 March, the JFTC recommended Intel abandon its policy of encouraging Japanese PC vendors to source microprocessors only from Intel by offering purchase-price rebates, the right to use the 'Intel Inside' logo and access to market development funding to those companies that did so. The anti-trust investigators said such schemes were intended to limit rival processor makers' market shares, and as such were anti-competitive.

From the wording employed in Intel's statement, it's clear the chip giant agrees with the first half of that last sentence, but not the second. Yes, it employed tactics to limit the market share of AMD and Transmeta, it's saying, but no, what we did was not an abuse of our market leadership.

Intel has always based that claim on its reading of "international antitrust principles", but what matters here surely is Japanese law, and that's what the JFTC based its decision on.

Still, the result is the same: Intel will end the programmes outlined by the JFTC, and do what it should have done in the first place: rely on the strength of its products and the power of its brand. That said, Intel is spared being dragged before the Japanese court and the cost that goes with it, and its rivals have failed to win the validation of their claims - and potentially the punitive action that might have come with it.

"Although Intel's willingness to comply with the JFTC recommendation is a step in the right direction," acknowledged AMD's legal affairs chief, Thomas McCoy, "it has conspicuously failed to either accept responsibility for its actions or acknowledge that competition is best served when customers and consumers have a choice.

"It is unfortunate that even when presented with specific - and very disturbing - findings of deliberate and systematic anti-competitive behaviour, Intel refuses to face the facts and admit the harm it has caused to competitors and consumers," he continued, adding "governments around the world must ensure that such anti-competitive actions are not impacting their markets as well". ®

Related stories

Intel Japan antitrust verdict response deadline delayed
Intel's Q1 'a little better' than expected
Japan calls Intel to task over anti-AMD rebates
Intel Japan faces anti-trust action

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