EU Batters Intel With More Charges

After bringing the world's biggest and most profitable software corporation, Microsoft, to its knees with a record $2.6B USD total in antitrust fines, the European Union began a serious investigation of chip maker Intel and whether it committed antitrust violations.

Intel, the world's largest chipmaker, fluctuates between having around 80 to 90 percent of the global microprocessor market, something some would term a monopoly, but which the business world terms more accurately as a "dominant position".  After a lengthy investigation -- featuring such assignment as raids of Intel offices in Europe -- the EU decided it had enough evidence to file formal charges.  The EU charged Intel with abusing its dominant position by using price slashing and illegal rebates to drive smaller chipmakers out of business and trying to create a monopoly.

Obviously, Intel disagreed.  Now the European Commission (EC), the EU's business monitoring unit, has battered Intel with a fresh round of charges.  It claims it has evidence that Intel bribed a leading European retailer not to stock products containing chips made by rival AMD.  It also charges Intel with paying the retailer to delay the release of a product containing AMD chips.  AMD had previously made such claims, but was unable to prove them, thus far.  It also accused Intel of giving illegal incentives to switch to its chips.

The EC has given Intel eight weeks to respond formally to the charges.  Intel officials say that they are "disappointed" by the charges.  The EC paints Intel as a bully in the report, stating that it "used its considerable muscle to provide substantial rebates to a leading European PC retailer - conditional on it selling only Intel-based PCs."

A statement from Intel rebuffed this view and accused the EU of conspiring with rival AMD, arguing, "The issuance of a second Statement of Objections suggests that the Commission supports AMD's position that Intel should be prevented from competing fairly and offering price discounts which have resulted in lower prices for consumers.  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."

The chip giant will have to make another formal response against the three new charges in Brussels.  Under its laws, if the European Union finds Intel to be guilty, it can fine it up to 10 percent of its international yearly revenue.  This could amount in as much as $4B USD, as Intel's yearly income is around $40B USD.  The E.U. Competition Commissioner Neelie Kroes, who approved the fines against Microsoft, believes that Intel may be a "bigger threat to competition" than Microsoft, so such a fine is not unimaginable.

Intel is making record profits while it