FTC Sues Intel For Decade Of Illegal Sales Tactics

The FTC sued microprocessor giant Intel yesterday, alleging the company had engaged in illegal sales tactics for the past 10 years, relying on backroom strongarming instead of over technical innovation to maintain market dominance.

The FTC says Intel used rebates and threats of vengeance to dissuade HP, Dell, and IBM from using AMD microprocessors. “The complaint also alleges Intel improperly bundled sales of microprocessors with its chip sets and made it hard for rivals to connect to its newer products, hurting Nvidia. The FTC also said Intel secretly redesigned programs called compilers to hurt the performance of software running on non-Intel chips,” wrote the WSJ.

Intel called the case “misguided” and vowed to fight back. Nvidia said it was “pleased to see scrutiny being placed on Intel’s behavior” and AMD said the FTC’s actions were “good news for consumers.”

U.S. Sues Intel Alleging Market Abuses [WSJ]

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  1. Mackinstyle says:

    I’m sorry, I can’t hear your bickering from all the way up here in PowerPC land. ;)

  2. ceez says:

    this types of articles always come up. if anything actually being done or does intel just $ilense the opposition each time?

    as the buy i could care less about how this ends up but it’s obvious that their competition (amd, nvidia, etc) hurt from their tactics. maybe we can get good oem processors much cheaper.

    • Jesse says:

      These accusations are nothing new but you have to remember that cases against big companies usually take time to build.

    • The hand that feeds, now with more bacon says:

      The buyers are hurt just as much as AMD and nVidia, if not more, especially in the realm of laptops. In the case of Intel paying system builders not to limit the use of AMD processors, what do you think happens to the consumer who actually wants an AMD processor? He pays more for it.

      What about embedded graphics chipsets in laptops? There’s usually a $100-$200 premium on laptops with Intel processors without an Intel graphics chipset. Note the performance difference between Intel graphics chips and those from nVidia and ATI is like the difference between a slide rule and a calculator, but you end up paying for the Intel chip whether or not it’s installed in a laptop you buy.

      Intel is shady. I’ve been complaining about it for years (including to the FTC). I’m glad someone is finally doing something about it.

  3. Joewithay says:

    So that is why there isn’t a Pentium 5 running at 5.0 GHz yet. Intel was too busy strongarming.

    • GreatWhiteNorth says:

      …no… they don’t have that processor yet because it would run hot enough to not only melt itself down, but half the block too.

      • zentex says:

        pretty much, this is why they went to multi-core and now multi-core with hyper-threading.

        Cheating to get the speeds the market demands.

    • Battlehork says:

      Clock speed isn’t the only factor in determining the performance of a CPU. From Intel’s Core series on up, the chips run at much slower clock speeds than the best of the Pentium 4 did, yet are still far faster.

    • Quake 'n' Shake says:

      The others covered it. But to sum it up…

      Faster clocks are really noisy. As it stands, it’s tough to get a clean signal at 3.2GHz. Also, power consumption and heat dissipation are issues. The Core series just plops multiple processors on one chip to increase performance. With core processors, multiple simultaneous processing can occur.

      / Works in the industry.
      // Withholding opinion on lawsuit due to conflicts of interests.

  4. sonneillon says:

    Nvidia said it was Nvidia.

    Sounds very much like The Borg. We are Nvidia resistance is futile.

  5. Julia789 says:

    Regardless, I still love the silly commercial that is shown in the photo. It makes me laugh every time I see it on TV.

  6. Geekybiker says:

    This is just coming to light now? I thought it was pretty common knowledge to anyone with an interest in the industry.

  7. LuzioFantazmic says:

    Up until Intel started producing the Core2Duo, I had always preferred the AMD processors. They were always more powerful and more importantly, much cheaper than an equivalently priced Intel chip. So I could never understand how or why AMD never could gain much ground on Intel in this area. I always assumed it was Intel marketing/branding that made people think they were getting a better product. Maybe I was wrong and there was some behind the scenes Microsoft type thuggery going on.

    • azntg says:

      Part marketing and part experience.

      Despite AMD chips costing less and performing better than comparable Intel chips, I grew weary of the chip’s propensity to overheat (with the supplied stock fan and eventually with a better cooling fan when the stock fan proved to be inadequate) and compromising the stability of my computer if I dared to use to use my computer for longer than an hour (did a diagnostic and narrowed the problem down to the processor level). I went as far as the K6 series and Athlon Thunderbird series before I went to Pentium IV and Core 2 Duo and never looked back.

  8. Amaras says:

    Nvidia said it was Nvidia said it was

    ^ I loled

  9. jtheletter says:

    So what the frak has the FTC been doing during this decade of abuse? I would expect it takes something like 1 to 3 years to put together a strong case to be sure a suit would have the desired outcome. Assuming also that there needed to be enough complaints to start an investigation that may have been another two years. So even padding the hell out of these assumptions there’s still 5 more years of inaction unaccounted for. To say this process is slow is rewarding failure. There should be an investigation into accountability at the FTC. How does this go by unchecked for 10 whole years?

    • TheSpatulaOfLove says:

      Intel didn’t keep up the Congressional Payola…

      Sorry, I’m a bit jaded today.

    • TailsToo says:

      Oh yeah, this has been going on for years, and the damage to consumers was done a decade ago.

      Banks giving out undeserved home loans will be investigated in 2019.

  10. Taed says:

    The line about “The FTC also said Intel secretly redesigned programs called compilers to hurt the performance of software running on non-Intel chips” is crap in my opinion. Yes, Intel makes compilers which can generate excellent code for a particular processor or family of processors, and I suspect that “optimize for AMD” is not one of the options. That’s no secret or evil. Microsoft, Sun, GNU, et al, also make compilers that can optimize for one processor over another. You can’t optimize for everything in a single executable. The programmer decides to optimize for the CPU that most interests them and/or their customer(s). If you’re doing some high-performance work that will only run on, say, a Pentium 4, then that’s what you’ll optimize for. Generally, though, you’d optimize for just the modern processors in general, which, of course, would then run slower than typical on an older processor.

    That’s like calling out Ford for making testing equipment which are great at tuning-up Ford cars and trucks, but which don’t work as well (but still work) on a Toyota.

    • jtheletter says:

      I read that quote as meaning that Intel specifically handicapped code compiled for other processors, not that they simply didn’t optimize it. There’s a big difference between not optimizing performance, and actively hampering it. Simply inserting a couple of no-ops in bad places or adding redundant high-delay register transfers would be enough to impede a program slightly without being overtly detectable.

      • Kitamura says:

        I’m not even sure how they’d do that. It’s not like assembly code has little flags saying “this be intel, this be not”. Naturally if you build a whole solution with optimization for a specific architecture, it’s not going to run as well on someone else’s architecture because there may be specific shortcuts available on a chipset that aren’t available on other chipsets. I mean, isn’t it the same with ATI and nVidia? nVidia cards allow for specific optimizations that allow games designed with nVidia in mind to have faster, smoother graphics than a non-nVidia card. Technically speaking, using an ATI card in those instances would also hurt the performance.

        • SkuldChan says:

          The compiler converts C/C++ into ASM there are plenty of opportunities to optimize for one architecture over another. Most compilers for instance have options to do this actually.

        • srh says:

          You are, of course, incorrect. It is quite trivial in assembly to determine which processor you are running on. Google ‘x86 cpuid’

    • SkuldChan says:

      Here’s a good example: http://www.eetimes.com/news/latest/showArticle.jhtml?articleID=179101712 (certain features in skype only work on intel machines).

      Intel actually had an office at my last job at a software company where they spent all day writing compiler optimizations for our stuff.

  11. DontCrossMe says:

    Ive used P4, AMD, AMD64, C2D. In my opinion the C2D is much better than those generations and I will only sell them because im tired of dealing with 3rd party MB manufacturer’s. If Nvidia and AMD made their own MB that worked Flawlessly like Intel’s do I would sell AMD. But until they do I wont.

    AMD did have a board but it was made by Foxconn and they were HORRIBLE. But again it was just a third party board with AMD logo on it.

    P4 was by far the biggest waist of money of its time. It ran at higher clock speeds to do the same work a lower clocked AMD could do. So My choice at that time was to sell AMD. Because of that I had 3x as many MB related problems due to third parties but it did introduce sales to replace those systems when the C2D came out.

  12. Tiandli says:

    Intel, Microsoft, even Nintendo with their NES console, it’s not surprising how they gain as much marketshare as they do. Illegal? Perhaps not, technically (I’m sure their lawyers are already figure that out).

    And it took the FTC 10 years to do anything? I don’t think companies actually mind. They made billions in the last decade and then may have to pay the equivalent of change from between their couch cushions in fines. In the end, they have all but 0.0000000000001% of their bankroll and still have most of the market in their other pocket.

  13. RandomZero says:

    Does anybody else find it hilarious that AMD and nVidia are looking so smug about this?

  14. god_forbids says:

    You might want to review the details here …

    http://anandtech.com/cpuchipsets/showdoc.aspx?i=3690