June 28, 2005
View Comments | Post CommentAMD Files Antitrust Suit Against Intel
AMD has filed a law suit against Intel. They're totally right, of course. Intel, like any good company, has tried to increase their market share by "encouraging" business partners to go with them instead of their competitors. In some industries, it's easier to do this legally than in others. Unfortunately, Intel has continuously offered special pricing and other forms of payment to partners for buying exclusively from them. This suit will be very long and drawn out, and whatever agreement the government comes to with Intel if AMD wins will likely not do much to fix things (same as with Microsoft).
Posted at June 28, 2005 4:21 PM | Comments (2)
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In the spirit of free trade in a pure sense, what is stopping AMD from making the same kind of deals? Couldn't AMD just make exclusive contracts with its customers, requiring that they not buy from Intel? I do understand that this is extremely unfeasable because of Intel's dominating market position, and I also understand that if everyone in the computer industry practiced business like this, it wouldnt be healthy for the industry as a whole. However, my gut reaction to this was that in a true free market, AMD would have to compete by offering its customers better deals with better chips in exchange for exclusivity. Im really confused as to whether or not I think this type of practice is really/should really be considered illegal and monopolistic, or just solid, highly competitive, cutthroat business.
Posted by: Chris Santoro at June 29, 2005 11:43 PM
Intel got into the market first, and protected their position. The trouble is that, for a big OEM like Dell or HP, a significant amount of their processors are gonna have to still be Intel because some customers demand it. So when Intel can say, "Either you only sell our chips, or else you pay twice as much for them," that's unfair and kills the free market. The free market is that informed buyers should be able to buy what they want to buy.
Posted by: David Barzelay at June 30, 2005 1:11 AM
