FTC Suit Could Aid GPU Market

By Jeffrey Burt  |  Posted 2009-12-16 Print this article Print


The FTC lawsuit is putting the spotlight on the graphics chip business, a growing area in the tech industry. It not only alleges anticompetitive practices by Intel against AMD going back almost a decade, but also more recent behavior against GPU makers, in particular Nvidia, illustrating the growing importance of graphics technology in general-purpose computing.

Black said it was important for the FTC to not only right some wrongs done in the past, but also to protect the GPGPU (general-purpose GPU) market.

"The good news is this lawsuit comes at a crucial moment for competition among graphics processing units," he said. "This extra scrutiny could help preserve competition there, which would mean better, cheaper products for customers and more innovation."

Nvidia and, more recently, AMD have aggressively pushed GPUs for highly parallel computing workloads, arguing that the graphics chips offer greater performance than CPUs at a better price. Both are pursuing co-processing models, in which both CPUs and GPUs are used in the same machines. AMD in 2011 will release the first of its Fusion integrated CPU-GPU products.

The FTC's action also comes just over a week after Intel decided to shelve its "Larrabee" GPU, which was scheduled for a first-generation release in early 2010. That said, Intel is planning to release processors in its "Westmere" portfolio early next year with greater GPU capabilities, and analysts expect Intel to continuing working on its own GPU technology.

Though Intel has known for several weeks that the FTC was concerned about the graphics issue, regulators were still giving Intel specifics about those concerns as late as Dec. 8, Melamed said. He accused the FTC of not fully investigating the issue before moving ahead with its complaint.

"The FTC has not sought [input] from Intel on these new issues," Melamed said. "It's relying entirely on the little bits of information they're getting from third parties."

The FTC said  the practices that Intel employed against AMD earlier in the decade-aimed at limiting the competitor's access to the market-were now being used against Nvidia. Intel is suing Nvidia over a licensing deal between the two companies in 2004. The agreement let Nvidia develop chip sets for Intel processors, but Intel claims that right doesn't extend to chips based on its "Nehalem" architecture or future platforms.

Both Nvidia and AMD expressed approval of the FTC's move.

"We are particularly pleased to see scrutiny being placed on Intel's behavior toward GPUs, which have become an increasingly important part of the PC industry," Nvidia said in a statement.

AMD's statement was equally brief: "The FTC's action against Intel is good news for consumers. It is yet another example of regulators around the globe acting to protect consumers by enforcing competition laws." 

Many analysts said they thought the agreement between Intel and AMD would mean the FTC would back off of its investigation. However, the addition of the graphics market and some of the e-mail exchanges between OEMs and Intel published in the N.Y. attorney general's lawsuit probably were enough to convince the FTC to continue its probe.

The e-mails are being used to bolster the claims by N.Y. Attorney General Andrew Cuomo that Intel over several years essentially bribed and coerced OEMs, including Dell, into limiting their use of AMD products.

"[FTC investigators] have seen the e-mails, and they're saying, 'This is really undesirable behavior,'" said Roger Kay, an analyst with Endpoint Technologies Associates. "They've seen Michael Dell quaking in his boots, and they're saying, 'Wow, this is really bad.'"


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