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Intel responds to Euro commission allegations

by Scott Bicheno on 18 July 2008, 09:47

Tags: Intel (NASDAQ:INTC)

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The European Commission (EC) sent a supplementary statement of objections (SO) to Intel (NASDAQ: INTC) yesterday, adding allegations to the original SO sent on 26th July 2007.

In this new one it reveals a preliminary conclusion, whatever that means, consisting of three extra allegations. Firstly that Intel paid off a leading European PC retailer to only sell Intel based PCS, secondly that it paid an OEM to delay the planned launch of an AMD-based product line and thirdly that it paid off that same OEM to get all its laptop CPUs from Intel.

Here’s the Intel response, verbatim.

"We’re naturally disappointed the Commission has decided to issue a new SO. The issuance of a second SO suggests that the Commission supports AMDs position that Intel should be prevented from competing fairly and offering price discounts which have resulted in lower prices for consumers.

"We will evaluate this newest SO and respond fully, but it’s clear that the allegations stem from the same set of complaints that our competitor, AMD, has been making to regulators and courts around the world for more than 10 years.

"We are confident that the worldwide microprocessor market is functioning normally and is highly competitive in Europe and elsewhere. Intel's conduct has always been lawful, pro-competitive and beneficial to consumers. As evidence of the existence of a highly competitive and innovative microprocessor market, consumers have benefited from prices that have gone down significantly, output has increased many times over, and the performance of products, including ours, has improved exponentially.

"We are confident that our response will show that the allegations in the SO are unfounded."

In its statement, the EC said: “Each of the conducts outlined in the 26 July 2007 Statement of Objections and the SSO is provisionally considered to constitute an abuse of a dominant position in its own right. However, the Commission also considers at this stage of its analysis that all the types of conduct reinforce each other and are part of a single overall anti-competitive strategy aimed at excluding AMD or limiting its access to the market.”

The supplementary SO doesn't name the retailer or OEM in question, but the FT yesterday reminded us the DSGi (the owner of PC World and Currys), German retail giant Media Markt and French retailer PPR have all been raided by the EC.


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