Intel officials are appealing the European Commission's $1.45 billion fine for antitrust violations, saying European regulators ignored the realities of a competitive processor market. The EC claimed that Intel practices around rebates and discounts violated European antitrust regulations and harmed rival AMD as well as European consumers.
As Intel officials had promised, the giant chip maker is appealing the
European Commission's
$1.45
billion fine stemming from antitrust allegations leveled by rival Advanced
Micro Devices.
Intel filed the appeal July 22, calling the EC's ruling wrong and did not
take into account the realities of the highly competitive processor
marketplace, which has resulted in lower prices and better products for
consumers and businesses, according to a spokesman.
"In real terms, microprocessor prices have fallen faster than the prices of
any other product tracked by the U.S.
government," Intel spokesman Bill Kircos said in a statement. "Similar research
supports this worldwide including Europe."
In addition, Kircos said, Intel never sells chips below cost.
The European Commission in May levied the fine, accusing Intel of illegally
offering rebates to systems manufacturers for buying only Intel chips, and for
making direct payments to OEMs to stop or delay the launch of products powered
by x86 processors from chip makers other than Intel. The offenses allegedly
took place between 2002 and 2007, according to the Commission.
The result was that millions of European consumers were harmed because they
did not have access to competitive products.
The fine came at a time when the
regulatory
environment is changing in the United States
as well, particularly with the Obama administration dismantling antitrust
policies that some believed hampered the federal government's ability to fight
anti-competitive behavior by corporations.
The changes on the federal level have led some observers to expect
that regulators will turn their eyes to such IT giants as Google and IBM,
as well as Intel.
The appeal comes a week after Intel released second-quarter earnings that
illustrated the impact the fine had on the chip maker's business. Without the
fine, Intel on July 14
posted
strong numbers, including a $1 billion profit on $8 billion in revenue.
However, that profit swung to a $398 million loss when the EC fine was factored
in.
For its part, AMD released
disappointing
second-quarter results July 21, with a $330 million loss on $1.18 billion
in revenue.
Intel spokesman Kircos said Intel plans to keep doing business as usual
while the appeal is under way.
"While we disagree with the decision and plan to appeal, we will work to
cooperate with the Commission to ensure we're in compliance with their
decision," he said. "Intel will continue to invest in the products and
technologies that provide Europe and the rest of the
world the industry's best performing processors at lower prices."
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