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EU Airs Out Intel's Dirty Laundry

By - Source: Tom's Hardware US | B 8 comments

The European Union has laid bare the dirty details of its evidence against Intel, publishing emails and notes from Intel executives that show the company was actively trying to smother the competition.

Intel has long contested the $1.45 billion fine from the European Union's antitrust division and yesterday, the EU responded to the appeal Intel filed in July by making a "non-confidential version" of its ruling final.

So what do we know now that we didn't know before? When the EU announced its ruling before the summer, it said that Intel was guilty of anti-competitive practices but now, we're finding out just what Intel was up to and good gracious if it doesn't paint Intel in a decidedly unflattering light.

The EU release includes details of rebates with manufacturers such as Dell, Lenovo and HP. Check out the deets of some of the deals below.

Rebates paid to Dell from December 2002 to December 2005 were conditioned on Dell purchasing exclusively Intel CPUs. For example, in an internal Dell presentation of February 2003, Dell noted that should it switch any part of its CPU supplies from Intel to its competitor AMD, Intel retaliation "could be severe and prolonged with impact to all LOBs [Lines of Business]."

The deal with HP was a little different. HP was awarded rebates provided the company adhered to several unwritten requirements. First and foremost, HP was to purchase at least 95 percent of its business desktop system from Intel. Second, although HP could purchase the remaining 5 percent from AMD, this was subject to further restrictive conditions. These included only selling AMD-based business desktops to small and medium enterprises, only via direct distribution channels (rather than distributors), and on HP postponing the launch of its first AMD-based business desktop in Europe by six months.

An internal email from HP and dates September 2004 reads, "You can NOT use the commercial AMD line in the channel in any country, it must be done direct. If you do and we get caught (and we will) the Intel moneys (each month) is gone (they would terminate the deal). The risk is too high."

Similar restrictions were places on deals with Acer and Lenovo with the former postponing the launch of an AMD-based notebook from September 2003 to January 2004.

Check out the full release from the European Union by clicking here.

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  • 1 Hide
    Pailin , 23 September 2009 01:34
    They deserved what they got really, doubly so after whining about it lol
  • 0 Hide
    Dandalf , 23 September 2009 01:52
    Whatever, Intel have done enough damage to deter THIS customer from purchasing any of their processors in the forseeable future.
  • 0 Hide
    mactronix , 23 September 2009 03:11
    I can understand the exclusivity idea but telling someone the price and continued business relied on them not selling or releasing another product,which can only be to give them a headstart in the market place is well beyond the pail.
    Those who went along with this instead of reporting the actions should be dealt with along the same lines.
    That not withstanding im still buying my hardware on a price/performance basis and as far as that goes im not about to rule Intel out. Cutting off the nose to spite the face is a saying that comes to mind.
  • Display all 8 comments.
  • 0 Hide
    shrex , 23 September 2009 03:45
    who gets the 1.45 billion
  • 1 Hide
    mactronix , 23 September 2009 04:05
    Not the people who have been effected that's for sure. It will get lost in the EU coughers you can depend on that.

  • 0 Hide
    strangestranger , 23 September 2009 04:35
    I don't know what Intel hoped to get out of appealing if they know this is they sort of thing that the EU had against them.

    Free market in practice people.
  • -2 Hide
    Anonymous , 23 September 2009 07:59
    It's business... They made money and they beat everyone to it. They produce some of the best hardware around as well. Regardless of what they've "done" i'd still buy Intel. The EU sues anyone anyway.. Microsoft can't ship IE in europe anymore can it? And i thought the american courts were bad. Talk about sueing season hmmm?
  • 0 Hide
    swamprat , 23 September 2009 19:33
    It's business... They made money and they beat everyone to it.

    It may be business, but you could argue that so would abducting someone's family to make them sign a hugely valuable deal, or operating protection rackets etc. They make the best products now and had done in the past, but they were clearly using their strong market position to stop competition. Huzzah for regulation (even if it's so late as to be silly)
    Given the jump that Intel made after a while of flagging behind AMD technologically we could be considered quite lucky that AMD weren't entirely stopped from operating / have borne losses for quite so long without folding. (not that we can be sure Intel wouldn't have eventually pushed design forwards rather than just upping clock speed forever on the Pentium Ds)