Intel, FTC Settle Anticompetition Case

Federal Trade Commission says the settlement is tougher than previous penalties lodged against the processor manufacturer.

W. David Gardner, Contributor

August 4, 2010

2 Min Read

Under the provisions of a Federal Trade Commission settlement Intel announced Wednesday, the processor manufacturer is prohibited from retaliating against competitors and from "conditioning benefits" for manufacturers that exclusively purchase chips from Intel.

The far-reaching settlement carries no monetary penalty -- the FTC can't level monetary penalties -- but the FTC said the settlement's provisions are more stringent than those leveled against the semiconductor firm in other actions.

"This case demonstrates that the FTC is willing to challenge anticompetitive conduct by even the most powerful companies in the fastest-moving industries," said FTC chairman Jon Liebowitz in a statement. "By accepting this settlement, we open the door to competition today and address Intel's anticompetitive conduct in a way that may not have been available in a final judgment years from now."

Liebowitz said the settlement has been structured in a way that will enable Intel to innovate and offer competitive pricing. The company, which has denied any wrongdoing, has said it believes the settlement won't impact its financials negatively.

The FTC case is the latest in a long line of complaints lodged against Intel, many of them stemming from complaints by archrival AMD as well as by Nvidia and Via; all three firms were cited in the FTC case.

The settlement requires Intel to modify intellectual property agreements with those three competitors so they will be freer to consider business deals with other companies "without the threat of being sued by Intel for patent infringement," said the FTC. The settlement also calls for Intel to maintain the PCI Express Bus so it will not limit the performance of graphics processing chips. The settlement also outlaws Intel from creating software compilers that discriminate against its competitors.

Intel has already paid AMD $1.25 billion to settle its antitrust case. Other cases against Intel were brought by the European Union and by other government agencies and companies. The Securities and Exchange Commission has estimated that Intel made payments of $4.3 billion to Dell in exchange for favorable treatment in using Intel processors.

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