Intel to appeal EU anti-trust ruling

13 May 2009

Global computer chip giant Intel has said today that it intends to appeal against the EU Commission’s ruling that it had violated anti-trust rules, and the imposition of a €1.06bn fine.

According to the Commission, throughout the period October 2002–December 2007, Intel abused its dominant position in the worldwide x86 CPU market by engaging in illegal anti-competitive practices designed to exclude competitors.

However, commenting on the ruling in a statement, Intel’s President and CEO Paul Otellini (pictured) said: “Intel takes strong exception to this decision. We believe the decision is wrong and ignores the reality of a highly competitive microprocessor marketplace.

“There has been absolutely zero harm to consumers. Intel will appeal,” he said.

Otellini insisted that Intel does not believe its practices violated European law. “The natural result of a competitive market with only two major suppliers is that when one company wins sales, the other does not.

“The Directorate General for Competition of the Commission ignored or refused to obtain significant evidence that contradicts the assertions in this decision. We believe this evidence shows that when companies perform well the market rewards them, when they don’t perform, the market acts accordingly,” Otellini said.

He also insisted that “Intel never sells products below cost”. Instead, it has “consistently invested in innovation, in manufacturing and in developing leadership technology. The result is that we can discount our products to compete in a highly competitive marketplace.”

However, despite Intel’s “strongly held views”, Otellini said the chip-maker plans to go through the appeals process and work with the Commission to ensure it is in compliance with its decision.

Intel holds at least a 70pc share of x86 CPU market globally, which is currently worth approximately €22bn (US$30bn) per year, with European sales accounting for approximately 30pc of that.

The Commission’s investigation followed complaints from chip-maker AMD in 2000, 2003 and 2006.

By Jennifer Yau

Pictured: Intel’s President and CEO, Paul Otellini