John Paczkowski

Recent Posts by John Paczkowski

New York AG: AMD x86ed by Intel?

There’s a reason Intel’s processors are in more than four out of five x86 computers sold in the global market and–like the European Union, Japan and South Korea–New York’s attorney general thinks it might be an anticompetitive one.

Empire State AG Andrew Cuomo today opened a formal antitrust investigation against Intel to determine if it violated state and federal antitrust laws by engaging in a relentless, worldwide campaign to coerce customers to refrain from dealing with its rivals. “After careful preliminary review, we have determined that questions raised about Intel’s potential anticompetitive conduct warrant a full and factual investigation,” Cuomo said in a statement. “Monopolistic practices are a serious concern, particularly for New Yorkers who are navigating an information-intensive economy.”

Harder still for Intel rivals navigating a potentially antitrust-intensive economy. Rivals like Advanced Micro Devices, who in 2005 filed its own antitrust lawsuit against Intel, accusing the company of using illegal inducements to dissuade OEMs from buying AMD processors and “knee-capping” those who did.

Harsh accusations, but ones supported by some disturbing anecdotal evidence. In 2000, for example, Michael Capellas, then chief executive of Compaq Computer, allegedly told AMD that Intel had withheld the delivery of some server chips because of Compaq’s relationship with AMD. He told AMD he would stop buying from it, saying he “had a gun to his head.” And in 2004, Gateway officials told AMD that Intel “beat them into guacamole” after they purchased some AMD microprocessors. These are but two incidents among 38 other alleged acts of coercion claimed by AMD in its suit.

Intel, of course, denies them all. Just as it denies AG Cuomo’s. “We believe our business practices are lawful,” said Intel spokesman Chuck Mulloy. “We also believe that the microprocessor market is a competitive market and is behaving just as one would expect a competitive market to behave.”