Long expected by many in the computer chip business, Advanced Micro Devices has filed an anti-trust suit against Intel, alleging monopoly maintenence -- the same charges that Microsoft faced a few years ago.
Intel controls about 80% of all microprocessor sales, despite having had a poor desktop product for the last several years. AMD alleges that Intel paid customers subsidies and rebates if they bought no more than a set number of AMD products. Companies that purchase no AMD products, like Dell, get the largest discounts.
In past years, Intel has attributed its sucess to its superior product, which has brought them to near-monopoly status. However, over the past 5 years, AMD has caught and passed Intel in every area except laptops, yet asserts their market share remains controlled by Intel's vendor contracts and periodic price wars.
The complaint, filed in Federal District Court in Delaware, asserts that Intel illegally used its size and market power to prevent its customers from also doing business with A.M.D., which competes with Intel in selling the x86 microprocessors that operate personal computers.About frigging time. Except for laptop processors, Intel has been chasing after AMD on a technical basis, while making it incrementally too costly for any company to buy more than token numbers of AMD parts. Microsoft beat Netscape with a better browser as much as market power -- Intel's using monopoly power to keep better designs off the market. Big difference, and I hope they pay. AMD has been the only innovator in processors for the last 5 years, and should be able to market their designs freely without a $300 billion dollar company's thumb on the scales.For instance, A.M.D. said, Intel withheld discounts from companies that bought more than approved quantities of processors from A.M.D.; paid for exclusive contracts; and warned its customers not to attend A.M.D. product launchings. A.M.D., based in Sunnyvale, Calif., named 38 companies, including Dell, Fujitsu, Compaq and Best Buy, as victims of such tactics.
"For most competitive situations, this is just business, but from a monopolist, this is illegal," Hector Ruiz, A.M.D.'s chairman, president and chief executive, wrote on the company's Web site, amd.com. "Earned success is one thing. Illegal maintenance of a monopoly is quite another."